Canoo stock price has collapsed this year, raising concerns that the electric vehicle company may be about to collapse. GOEV shares have crashed by over 53% in the last 30 days and 92% this year, bringing its market cap to about $43 million. This is a major downfall for a company that was valued at over $4 billion a few years ago.

GOEV stock has collapsed despite progress

The GOEV share price continued its strong downtrend even after the company published fairly encouraging financial results. 

These numbers showed that its revenue for the quarter stood at $0.9 million, bringing the year-to-date figure to $1.5 million. These are small numbers because the company has just started shipping its vehicles recently.

Most importantly, Canoo’s cost cuts have helped improve its bottom line as the adjusted EBITDA loss was $37.7 million, a 2% improvement from what it made last year. The loss per share was 54 cents, a big improvement from $1.71 last year.

The results also showed that Canoo improved its cash burn during the quarter. It incinerated $31.3 million after burning $39.4 million in the same period last year. 

These numbers mean that the company is making progress in managing its costs. This trend has been helped by its ongoing consolidation of operations from California to Texas and Oklahoma, where it has received a Free Trade Zone (FTZ) authorisation. 

Canoo expects that its business will continue making progress in the fourth quarter of 2024. It sees its cash outflow moving to between $30 million and $40 million. Its adjusted EBITDA is expected to be between minus $30 million and $35 million. 

To a large extent, Canoo is a good company that is building vehicles with a large market potential, among fleets. Indeed, it has already received large orders from popular organizations like the USPS, Walmart, Okla, and Jazeera Paints.

These firms own thousands of internal combustion engine vehicles that they will want to replace with EVs over time. Most importantly, the industry, especially in the United States, is not all that competitive for now. Some of the biggest competitors are firms like Workhorse Group and Rivian.

Balance sheet issues

Canoo’s biggest challenge is that its balance sheet cannot support its operations for now. The company will need to continually raise cash from investors since it has a long path towards profitability. 

Companies like Rivian and Lucid Group provide more signs on how electric vehicle companies take long before turning a profit. Rivian, which started delivering its vehicles a few months ago, has continued to report large losses over time. Similarly, Lucid Group has lost money, leading to a bailout from Saudi Arabia.

Canoo’s balance sheet woes saw it raise $27 million in the third quarter and another $12 million credit facility recently. These funds are not enough for a company that expects to burn over $30 million in the fourth quarter. 

This means that Canoo, which has issued a going concern warning before, will struggle in the coming months.

What next for Canoo stock?

GOEV chart by TradingView

From a macro perspective, we believe that the post-Trump election slump of EV companies was an exaggerated move. We don’t think that he will end the tax credits of electric vehicles because of their popularity among consumers and manufacturers. Also, Trump is close to Elon Musk who runs the biggest EV company in the world.

On the positive side, there are signs that the GOEV stock price could stage a strong comeback now that it has formed a falling wedge pattern on the daily chart. This pattern is characterized by two falling and converging trendlines. 

In most periods, a strong comeback happens when the two lines are about to converge, which is happening now. This, coupled with the fact that Canoo has a high short interest of 11%, means that it could have a short squeeze soon. 

If this happens, the Canoo stock could jump to $3.30, which is about 670% above the current level. In the long term, however, the company will likely remain under pressure as challenges remain. 

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China’s outbound mergers and acquisitions (M&A) activity could see a significant uptick as US President-elect Donald Trump’s proposed tariffs push mainland firms to accelerate their globalization strategies.

Experts suggest that fears of tariffs ranging from 60% to 100% on Chinese goods are driving businesses to seek alternatives to mitigate reliance on the US market, according to a report by South China Morning Post.

“More tariffs may mean the globalization of Chinese companies is going to get faster,” said Stanley Lah, Asia-Pacific and China M&A services leader at Deloitte.

“Chinese companies will consider moving faster to look for alternatives in shipping or selling to the US.”

Outbound M&A beats greenfield investments

Chinese companies are increasingly turning to outbound M&A as a quicker way to achieve global market efficiency, compared to greenfield investments like setting up factories or offices abroad.

Despite a frail global M&A environment, Chinese firms see this route as vital.

According to London Stock Exchange Group data, outbound M&A deals by Chinese companies fell 16.5% to $17 billion this year but are showing signs of rebounding in strategic sectors.

Last year, outbound M&A rose 59% year on year to $27 billion, though still far below the $202 billion peak of 2016.

Sectors with Beijing’s blessings drive deal-making

Certain sectors—such as technology, manufacturing, and new energy—are benefiting from government backing, which could sustain the momentum in outbound M&A.

Federico Bazzoni, CEO of investment banking at Vantage Capital Markets, highlighted these areas as prime targets for Chinese dealmakers.

For instance, Tencent Holdings recently acquired Cyprus-based game maker Easybrain for $1.2 billion, and Midea Group bought the climate division of Swiss firm Arbonia for $811 million earlier this year.

“Valuations are coming down, and we’re seeing some activity return,” Bazzoni said.

However, mega deals akin to ChemChina’s $43 billion Syngenta acquisition in 2017 remain rare due to regulatory uncertainties.

Regulatory and geopolitical hurdles dampen mega deals

Geopolitical tensions and complex regulatory approvals continue to weigh on the M&A landscape.

“Geopolitical sentiment is sensitive, and deals are complicated, pushing down the headline deals in recent years,” Deloitte’s Lah said.

Despite these challenges, there is cautious optimism for a rebound in 2025.

“State-owned enterprises and corporates are waiting to see what happens with domestic and US policies before engaging with new targets,” Bazzoni added.

Inbound M&A dims under Trump’s shadow

While outbound activity shows potential, the picture for inbound M&A in China remains bleak.

Trump’s likely intensification of restrictions on Chinese access to advanced technologies such as AI and semiconductors has discouraged US investors from entering the Chinese market.

Although Beijing has reassured foreign investors of its openness, long-term capital remains hesitant.

“Investors are looking to confirm that the country’s efforts to support economic development are sustainable,” said Lah.

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Archer Aviation stock price has gone parabolic in the past few weeks, helped by a positive statement from Needham analysts and commercialisation hopes. The ACHR share price jumped to $6.22 on Friday, its highest level since December 2023 and 120% above its lowest level in October. 

Archer Aviation stock is about to form a golden cross

Technically, there are signs that the ACHR share price will continue doing well in the coming months. 

The most significant catalyst is that the stock is about to form a golden cross pattern, which is a rare event when the 50-day and 200-day moving averages cross each other.

In this case, the 50-day EMA stands at $3.83, while the 200-day EMA is at $3.94 and the spread is narrowing by the day.

Indeed, a golden cross has already happened when you consider the Weighted Moving Average (WMA), which is usually more responsive than the EMA. 

Archer Aviation stock has risen above the important resistance level at $5.57, its highest level in July, and the neckline of the slanted double-bottom pattern at around $3. A double-bottom is one of the most bullish reversal patterns in the market. 

Archer Aviation shares have the momentum as the Average Direction Index (ADX) has jumped to 42. The Relative Strength Index (RSI) and the MACD indicators have all pointed upwards in the past few months. 

Therefore, there is a likelihood that the stock will continue rising in the coming weeks as bulls target last year’s high of $7.50, which is about 24% above the current level. For this bullish view to happen, the stock will need to rise above the key resistance point at $6.22, its highest level on Friday. 

Such a move will invalidate the doji pattern that has formed. A doji is made up of a small body and long upper and lower shadows and is a sign that an asset opened and closed at the same price. It is one of the most popular bearish reversal signs.

In line with the doji candlestick, there is a likelihood that the stock will form a break and retest pattern, where it retests the support at $5.47 and then resumes the uptrend. 

Read more: Joby and Archer Aviation shares soar after new Buy ratings but patience key for those stocking up

ACHR has made progress

Archer Aviation stock has jumped after the company made substantial progress as it matches towards commercialisation of its EVTOL aircraft in either 2025 or 2026. 

It is about to complete building of its manufacturing facility, which will be used to build its piloted aircraft for more testing and early commercialisation. 

The company is also nearing the completion of Phase 3 of its FAA certification, which will be followed by the final phase. If this happens, it will make Archer Aviation one of the earliest companies to receive these documents from the FAA.

Archer Aviation has already made several deals that will help it become a leader in the eVTOL space. Most recently, it reached a deal with Soracle, a joint venture between Japan Airlines and Sumitomo Corporation. The venture will make an order worth about $500 million, bringing Archer’s order book to $6 billion. 

Archer Aviation has also raised cash from Stellantis, the parent company of Jeep and Chrysler. These funds will go a long way in helping it deal with the manufacturing, R&D, and certification process. 

Most importantly, Stellantis will support it in the manufacturing process by providing the needed cash. It will then receive compensation by newly issued shares by the company, a sign that it sees immense value. 

Read more: Archer Aviation: risk/reward analysis for this flying car stock

Archer faces major headwinds

Still, the biggest challenge the company faces is whether there will be sufficient demand for its aircraft in the long term. The other key issue is whether the company will continue diluting its shareholders as it has done in the past. Its outstanding shares have jumped from about 50 million in 2021 to over 383 million today.

History shows that new disruptive companies take a long time to become profitable. Three examples of this are companies like Rivian, VinFast, and Lucid Group, which are well-known bands in the electric vehicle industry. The three firms have continued to incinerate billions of dollars, leading to their bailouts. 

The most recent results showed that Archer Aviation’s costs and losses continued rising in the last quarter. Its operating expenses jumped to $122 million, leading to a net loss of over $115 million. The net loss was much higher than the $106 million it shed in the last quarter and the $51 million it had in the same period last year. 

The company ended the quarter with $501 million, meaning that it will need additional cash in 2023 since its expenses are still high. 

Still, the Archer Aviation stock price may continue to do well as investors anticipate more revenues when its commercialisation process starts. 

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Bitcoin (BTC) experienced a sharp price decline, falling from last week’s high of $98,500 to a low of $95,500 during late US trading hours on Sunday.

The 3.5% drop marked a technical pullback driven by profit-taking as the token approached the significant $100,000 milestone.

While the market quickly stabilised during Asian trading hours on Monday, the broader cryptocurrency sector felt the ripple effects of Bitcoin’s retreat.

The overall crypto market capitalisation fell by 2.4%, with major tokens, including XRP, Dogecoin (DOGE), Solana (SOL), Ethereum (ETH), Cardano (ADA), and Binance Coin (BNB), dropping between 2% and 5% before partially recovering.

The broad-based CoinDesk 20 Index (CD20), tracking top cryptocurrencies, declined by 1.48% over 24 hours.

Volatility in the cryptocurrency market triggered significant losses in futures markets, with over $500 million liquidated across bullish and bearish bets, according to data from Coinglass.

Notably, long positions, accounting for $366 million, were disproportionately affected as traders locked in profits or exited the market amid uncertainty.

Short positions saw liquidations totalling $127 million.

Small altcoins and mid-cap tokens bore the brunt of the liquidations, accounting for over $100 million in losses—a trend that indicates increasing risk-taking behaviour among traders.

This shift underscores the heightened speculative activity in the market, particularly outside of Bitcoin and Ethereum.

Profit-taking halts Bitcoin’s rally near $100,000

Bitcoin’s price movement over the weekend highlights the challenges it faces in maintaining upward momentum as it approaches key psychological levels.

The $100,000 mark remains a significant milestone that could invite further institutional and retail interest.

Analysts attribute the pullback to routine profit-taking rather than a fundamental shift in market dynamics, emphasising that Bitcoin remains the leader in driving crypto market trends.

The token’s recent rally has been largely attributed to increased institutional interest, driven by the proliferation of exchange-traded funds (ETFs) linked to Bitcoin. As these ETFs gain traction, they are expected to continue bolstering demand for the cryptocurrency.

Altcoins follow Bitcoin’s lead

XRP and Dogecoin led the losses among major tokens, each falling more than 5%. Ethereum, Solana, Cardano, and Binance Coin also experienced declines but managed to recover some of their losses during early Monday trading.

The uneven performance of altcoins reflects the broader market’s dependency on Bitcoin’s price trajectory.

Despite the weekend’s volatility, traders remain optimistic about the medium-term prospects for altcoins.

Ethereum ETFs, once widely adopted, could further stabilise the market and lead to renewed interest in other top-tier cryptocurrencies.

Market observers continue to point to institutional buying of crypto ETFs as a key driver of Bitcoin’s strength.

With Bitcoin ETFs already spurring demand, Ethereum ETFs are expected to gain traction once they receive broader regulatory approval.

The introduction of Solana ETFs, currently under consideration, could further diversify institutional investments.

Although the market’s recent movements have sparked concerns, traders generally remain optimistic about Bitcoin reaching the $100,000 threshold soon.

This optimism is bolstered by steady gains in traditional equity markets and favourable macroeconomic conditions.

Looking ahead, analysts anticipate that pro-crypto policies, particularly in the US, could sustain the current rally into 2025.

Discussions between political stakeholders and crypto executives signal a potential shift towards more supportive regulatory frameworks, which could benefit Bitcoin and other leading cryptocurrencies.

The market’s resilience during the latest pullback demonstrates the continued confidence in digital assets, even amid heightened volatility.

As institutional adoption increases and regulatory clarity improves, the crypto market appears well-positioned to navigate future challenges.

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The Joby Aviation stock price has bounced back and surged to a high of $7.30, its highest level since July 14. It has jumped by almost 60% from its lowest level this year, giving it a market cap of over $5.4 billion, making it the biggest player in the electric vertical takeoff and liftoff (eVTOL) industry. 

Joby Aviation stock has the momentum

The daily chart shows that the Joby Aviation share price has been in a strong bull run in the past few weeks. As it jumped, the stock moved above the important resistance level at $6.60, its highest level on October 23rd. Moving above that level helped the coin invalidate the forming double-top pattern. 

Joby has moved above the 50-day and 200-day Weighted Moving Averages (WMA), indicating robust demand. It has also moved above the Ichimoku cloud indicator.

Meanwhile, JOBY shares have jumped to the strong pivot reverse point at $7.03, meaning that it has more room to rally before getting to the extreme overshoot level of $8.60. 

Joby Aviation stock’s oscillators have all pointed upwards in the past few days, a sign that it has a bullish momentum. The Relative Strength Index (RSI) has risen and is approaching the overbought level of 70, while the MACD indicator has jumped above the zero line. 

Therefore, there are rising odds that the JOBY share price will continue rising in the coming days as bulls target $8.60, which is about 22% above the current level. Most of this upside will be confirmed if the stock jumps above the key resistance level at $7.67, its highest level in July. 

A closer look shows that the stock is in the process of forming a cup and handle pattern, a popular continuation sign. As such, by measuring the distance between the upper and lower side of the cup, we can estimate that the stock will ultimately rise to $12.73. 

The bullish view will become invalid if the stock drops below the psychologically important support at $5.

Joby has made progress

The Joby Aviation stock price has jumped, helped by the strong progress that the eVTOL company has made in the past few years. 

First, the company has a long partnership with Toyota, a company that has perfected the manufacturing process in the past decades Last month, Toyota announced that it would invest another $500 million in the company. Joby hopes to use these funds in the certification and manufacturing process. 

These funds, together with the $710 million it had in cash and short-term investments and the $222 million it raised recently, brought its total hoard at over $1.4 billion. 

Second, the company has created prototypes that have made progress in the certification process. Joby has already cleared the first three stages of certification, which include certification basis, means of compliance, and certification plans. 

It now has two stages remaining: testing and analysis and show and verify. The management hopes that the certification process will be completed by 2025.

Key concerns for JOBY remains

A key concern is that Joby Aviation will need to raise additional cash in 2025 or early 2026 since it is losing substantial sums of money. The most recent financial results showed that Joby Aviation’s net loss rose to over $143 million in the last quarter and $361 million in the first nine months of the year. 

The other big concern is whether there is a strong demand for eVTOL aircraft in the first place. Estimates are that the eVTOL industry was valued at $1.2 billion in 2023, a figure that will hit $170 billion in 2034. 

If these estimates are correct, it means that the company will be in a pole position and have a dominant market share. The challenge, however, is that these estimates are all based on hypotheticals since this is a new industry. 

The other key concern is that the industry is getting highly competitive, with names like Bell Textron, Archer Aviation, and eHang being in a pole position. In China, XPeng has announced plans for its AeroHT, which it hopes will have a leading market share. 

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