Lucid Group Stock Price and Forecast: Why was LCID stock up 5% on Wednesday?

Lucid Group stock continues the recent rally as its rises 5% on Wednesday.
LCID shares still aiming to break back above $30.
Lucid Group's short interest continues to rise.

Ivan Brian FXStreet

Lucid Group (LCID) shares followed most growth stocks higher on Wednesday as a calming of bond yields led growth to outperform value. The shares had already rallied just under 2% on Tuesday.

Lucid Group Stock News

Benzinga recently reported that Lucid's short interest had grown to over 20% of its float. This is in keeping with the decline in the share price, and we do not put too much significance on it. It is a relatively low number given the daily turnover in Lucid and should not lead to a short squeeze in our view.

Lucid has been struggling since Rivian's (RIVN) last earnings report showed deliveries missing estimates. This made investors wary of the high-growth EV space. The macro-environment then totally changed with a hawkish Fed and soaring bond yields. This meant high growth equities struggled. Despite this, the stock remains frequently at the top of social media charts, and Benzinga notes it was in the top ten tickers searched on its platform in January. Despite this momentum, shares keep falling. Momentum is the key for growth stocks, and retail investors are fighting an uphill battle as fast money has moved to other sectors.

Lucid Stock Forecast

The CPI print just out is likely to refuel hawks and see global yields remain elevated after recent stabilizations. This will see growth stocks hit once more. Lucid then will remain under pressure in our view. The volume gap has worked well, and $30 is resistance at the lower end of this volume gap. The 200-day moving average at $29.22 also shows the strong resistance of this zone. The next target support is at $22.

Lucid chart, daily

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Author

Ivan Brian

FXStreet

Ivan Brian started his career with AIB Bank in corporate finance and then worked for seven years at Baxter. He started as a macro analyst before becoming Head of Research and then CFO.

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