Virgin Galactic (NYSE: SPCE) stock has been in a tailspin since the collapse of its former subsidiary Virgin Orbit (NASDAQ: VORB). Virgin Galactic is one of the few companies working in the realm of space tourism. The company has been facing financial difficulties for the past few months, which are also being reflected in its stock.
After dropping below $3, Virgin Galactic share price rebounded in the past week. However, the bounce was short-lived, and the stock tumbled once again. Nevertheless, the shares closed the week with 5.71% gains after seven consecutive weeks of downward price action.
LON: SPCE Makes New All-Time Low
The bankruptcy of Virgin Orbit (VORB) was a major blow to Richard Branson’s credibility. This led to a major sell-off in the shares f Virgin Galactic, which still holds a 75% stake in the collapsed satellite launch company. Consequently, Virgin Galactic share price dropped to its all-time low in April 2023 and appears to have much more downside as per the following analysis.
Another reason behind the negative price action at the end of last week was the correction in S&P 500 and the Nasdaq 100 indices. The benchmark indices remained negative during the last trading session of the week. On Monday, Virgin Galactic stock rose 1.5% in the pre-market.
Virgin Galactic Stock Price Hangs By A Thread
I was not convinced by the recent bounce in the NYSE: SPCE, because the stock has yet to meet its target on the daily chart. The recent all-time low has given bears full control. The only visible support on the chart is the bottom of the descending wedge pattern. Due to this reason, I expect the price to drop below $2.50 in the coming months.
The only way to avoid this bearish Virgin Galactic stock price forecast is for the price to break above the $4.12 level. Under current market conditions, this seems to be a tough ask, as the recent retail numbers show that the Fed may increase the interest rates once again in the next FOMC meeting.
In the meantime, I’ll keep sharing updated outlook on the Virgin Galactic shares in my free Telegram group that you’re welcome to join.
