The American company Virgin Galactic, which specializes in suborbital space flights, showed a very impressive rise in the price of its securities by + 28%. So what caused this growth and how long it is – we are looking at it right now.
SpaceShipTwo made a test flight
On May 22, Richard Branson’s company performed the long-awaited test flight of the SpaceShipTwo spacecraft. Recall that the launch was supposed to take place in February this year, but was canceled due to the need for additional technical checks.
This is the first successful test of a Virgin Galactic ship since February 2019. Thanks to this event, the space holding will be able to catch up on the schedule of planned launches and open the sale of tickets for future flights.
Virgin Galactic shares jump 28%
An event so important for the company could not but affect its quotes. On May 24, the value of Virgin Galactic Holdings Inc. (NYSE: SPCE) rose 27.62% to $ 26.89.
Separately, we note that the rise in the price of shares of the corporation lasted seven sessions in a row, from May 14 to 24. During this period, securities added 73.5% in price. This year, quotations reached their maximum in February – $ 59.41 per unit. However, indefinitely postponing the February test flight hit Mr. Branson’s stock hard.
The positive dynamics was interrupted on May 25: at the end of the trading session on Tuesday, the price of securities decreased by 4.83%, dropping to $ 25.59 per unit.
Technical analysis of Virgin Galactic shares by Maxim Artyomov
“Virgin Galactic opened the trading session with a price gap following the successful test of the SpaceShipTwo. As the next trading session showed, it is likely speculators’ attempts to drive up the price on rumors and expectations.
At the moment, quotes are traded in the area of the upper border of the channel. Given the general downward trend, it can be assumed that a rebound from the resistance line will occur and the price will return to its previous values. Support at the $ 22 mark serves as a benchmark for the decline.
An additional signal for the continuation of the downtrend is the test of the 200-day moving average, a rebound from which will be the beginning of a new impulse to decline. In the future, the quotes, having tested the $ 22 mark, may rebound and develop another growth impulse. “
Summing up the result
Virgin Galactic’s stock began to rally amid information about the upcoming test flight of the SpaceShipTwo spacecraft. According to Seeking Alpha, on May 20, the daily turnover of the corporation’s securities jumped 5.5 times and reached 69 million shares.
After the successful completion of the test flight, the company’s quotes jumped by 27.62%, to $ 26.89. However, the very next day they lost almost 5% in price.
What else to read about the promotions of companies from the space tourism sector?