Rivian stock forecast: Wyckoff theory points to long‑term rebound

Rivian stock price is stuck in a technical bear market after falling from last December’s high of $22.7 to the current $15.20. It retreated after the company shared details of the upcoming R2 vehicle, with its short interest continuing to rise. So, will the stock rebound or continue the downward trend?

Rivian announced details for R2 vehicles 

Rivian, a top American electric vehicle company, is facing major headwinds as it launches its make-or-break car. In a statement, the company said that its R2 vehicle will start at $57,990 and will have a range of 330 miles on a single charge.

The company then plans to launch cheaper models late last year. This vehicle will have a 245-mile range and cost $45,000.

Additionally, Rivian plans to launch new R3 models that will cost much lower than the current models and compete with other companies, especially Chinese brands.

Rivian hopes to sell between 20k and 25k R2 vehicles this year, a move that will generate about $1.4 billion in revenue. It then hopes to manufacture 400k at its new plant in Georgia.

Rivian hopes that the new vehicles will help to expand its appeal among customers interested in owning EVs. Its current models start at $70,000, with some models going for over $100,000, making them popular among wealthy people.

The company hopes that the vehicle will gain appeal from customers who are buying vehicles like the Tesla Model Y. Tesla sold over 360k Model Y vehicles last year.

Rivian is facing major headwinds 

Analysts believe that Rivian’s R2 vehicle launch will lead to higher revenues this year. Data compiled by Yahoo Finance shows that the average estimate is that Rivian will make $1.35 billion this quarter and $6.95 billion this year. 

The annual revenue will be a 30% increase from what it made last year and will come as the company sells between 62,000 and 67,000 vehicles this year.

This growth will then continue as it sells more vehicles in 2027, with its revenue rising to over $11.9 billion. 

The challenge, however, is that the company has never made a profit since its launch 17 years ago, and analysts expect the loss-making trajectory to continue. Its earnings-per-share (EPS) this year is expected to be $2.95 followed by $2.44 next year.

A major challenge is that the company will likely need to raise more money this year or in 2027. It ended last year with $3.5 billion in cash and short-term investments, and the plans to spend about $2 billion in capital expenditure. 

Rivian has always been highly dilutive, which has pushed its outstanding shares from 892 million in 2022 to 1.23 billion today.

Rivian stock price technical analysis 

RIVN stock chart | Source: TradingView

The weekly chart shows that the RIVN stock has remained inside the key support and resistance levels at $9.07 and $25 since December 2022.

This consolidation has pushed the Average True Range (ATR) lower, a sign that the volatility has dropped. It is slow oscillating at the 50-day and 100-day Exponential Moving Averages (EMA).

There are signs that the company is in the accumulation phase of the Wyckoff Theory, which often leads to the markup stage, which is characterized by a vertical surge.

Therefore, there is a likelihood that the stock will surge, initially to the key resistance level at $25, the upper side of the channel. A move above that level will point to more gains, potentially to $40, its highest point in September 2022.

The challenge, however is that this view is based on the weekly chart, which takes