- DWAC stock closed down over 15% on Tuesday.
- Digital World Acquisition Corp stock is down another 4% in Wednesday's premarket.
- DWAC is to take Truth Social public via a SPAC deal.
DWAC stock suffered a sharp fall on Tuesday as it closed down nearly 16% at $48. The stock has been losing ground lately as a series of weak newsflows hurts momentum. Digital World Acquisition Corp is the Special Purpose Acquisition Vehicle (SPAC) that is due to take former US President Donald Trump's Trump Media & Technology Group (TMTG) public, an event scheduled for some time this year. TMTG owns the Truth Social media platform.
DWAC stock was already on the back foot when news of Tesla CEO Elon Musk taking a 9.2% stake in Twitter broke earlier this week. Twitter (TWTR) then announced on Tuesday that Musk would be joining its board.
DWAC stock news: Trump angry about Truth Social app rollout?
On Monday, TMTG Truth Social executives Josh Adams and Billy Boozer had left the company, as reported by Reuters. Josh Adams was the Chief Technology Officer while Billy Boozer was Head of Product Development of TMTG. This added to recent concerns over the development of the Truth Social app.
The launch has been beset with delays and limited interaction or "truths" from former President Trump. In all likelihood, he may be waiting for these glitches to be corrected. The former President was a noted user of Twitter and the UK Daily Mail reported on Tuesday that Twitter has no plans to reinstate his account: "Twitter is committed to impartiality in the development and enforcement of its policies and rules. Our policy decisions are not determined by the Board or shareholders, and we have no plans to reverse any policy decisions."
The Washington Post carried a story on Tuesday that former President Trump "has privately fumed about the app’s slow rollout and has mused about joining other platforms such as Gettr, one of its biggest competitors, according to people familiar with the matter who spoke on the condition of anonymity because of the sensitivity of the subject".
TWTR stock soared on Monday by 27% and added another 2% on Tuesday. DWAC by comparison lost 10% on Monday and another 15.7% on Tuesday.
DWAC stock forecast: Breaking below key $50 support
Momentum has dried up significantly. There is probably a huge marketplace for the view of former President Trump given he had a huge Twitter following and this was evidenced in the enormous frenzy that drove DWAC stock from $12 to $175 in two days back in October. We identified the consolidation zone around $50 as support and it looks now that DWAC stock will solidly break this level. That brings $39.31 into view as the next support level. $60.32 remains the key resistance.
DWAC stock chart, daily
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