What's going on moon gang, my name is matt and i hope you're having a great day, i'm assuming if you clicked on this video you're interested in workhorse and you most likely know that workhorses stock took a considerable hit today in this video i'll. Be explaining exactly what happened that caused the decline and also be doing a technical breakdown of the charts, so we're better prepared for whatever happens next, but before i dive into all that fun stuff. If you're new to the channel, you can join the moon gang by hitting the subscribe button, i'm just under 3 000 subscribers and your help with hitting that milestone would be truly appreciated. It would also be awesome if you could drop a like, because it really helps with the youtube algorithm, since workhorses stock did take a considerable hit today.

I would love to know your thoughts on what's going to happen next, do you think it will bounce or continue to fall? Let me know in a comment below now with that out of the way, let's roll the tape. So why did workhorses stock fall off a cliff today? It all started on friday october 9th it was announced that roth capital sees positive outcome for workhorse in usps contract roth capital. Analyst craig irwin sees a positive outcome for workhorse for the 8.1 billion dollar usps next generation delivery vehicle contract. He had a buy rating with a price target of 33 dollars and was expecting to hear about the winner of this usps contract.

When i'm filming this video on october 13th, unfortunately to the dismay of many investors, myself included, that didn't happen, workhorse downgraded on concerns over postal service contract timing, roth capital, analyst, craig irwin downgraded electric truck maker workhorse to neutral from buy after a u.s postal service spokesperson, Told roth, the usps won't decide who wins the competition for its next generation delivery trucks until end of year, irwin cut his share price target from 33 dollars to 27. Now i have two comments on this. I fully understand that stocks drop when market expectations aren't met, especially when those expectations are for an 8.1 billion dollar contract with the government, but on the other hand, why would you cut your price target? It's not like anything, has fundamentally changed about workhorse. They didn't lose the usps contract, it just hasn't been awarded yet, and i would argue that they're still the front runner, it doesn't make sense to go from 33 dollars to 27 when we will find out the winner between now and december.

When you consider everything that's going on, if you like workhorse before today, started, you should love them now. Yes, the usps contract was delayed, but that's neither good nor bad. Roth capital did lower their price target, but that doesn't make much sense, at least to me, and on top of that workhorse secured 200 million dollars in financing to boost production. Workhorse on monday said that it has secured 200 million dollars in financing through entering into a note purchase agreement npa with two institutional leaders to increase production volumes.

Apart from accelerating production volumes, workhorse intends to use the proceedings to advance new products to market, replace previous higher cost financings and support current working capital and other general corporate purposes. This is a massively bullish announcement in my previous videos, i discussed how workhorse has a partnership with hitachi and they're also hiring a lot of personnel. When you put all three of these things together, it looks like workhorse is doing everything it needs to to massively ramp up its production. Now it's unclear if these three things are specifically for the usps contract or if they're for general growth over the next decade, but whatever it is.

Workhorse is clearly gearing up to make a lot of electric delivery vans. Here is a look at workhorses 30 minute chart. Workhorse trades under the ticker wkhs and when the market closed for the day, the stock was at 23.63, which means it dropped 11 and when you consider yesterday's high, the stock is currently down almost 23 percent. For those of you interested over the past week, it's down two percent over the past one month, it's down 10 and over the past three months, it's actually up 43 and to give you a little bit of perspective over the past six months, workhorse is still up Over a thousand percent, i wanted to quickly bring this to your attention, because workhorse is definitely a speculative play.

You shouldn't anticipate a lot of volatility. It's not that insane to have an 11 drop when you're up over a thousand percent in the past six months. Now i know when i say that you should have some perspective. That's easier said than done, because, if you're an investor in workhorse, your portfolio most likely took a hit today, so to get a better idea of what we should be watching for next, let's switch over to the daily chart.

This time frame gives us an even better look at the recent volatility in workhorse. The stock was caught in this rising wedge, where it was making higher lows and lower highs, and then, on friday october, 9th roth capital came out with their analysis of workhorse and the usps contract and in a single day, workhorse went up over 12 percent. The momentum then carried into monday october 12th, where the stock almost tested its all-time high at 31, but when the usps contract was delayed, the stock quickly plummeted, which brings us to today from a technical perspective. We are at an interesting point: workhorse did manage to make a new higher high relative to its previous one, but now the stock is at this intersection of the two wedge trend lines, even though today's action was definitely bearish.

I do take comfort in the fact that the support at 22.6 has now held for the fifth time. To be honest, i was strongly considering buying more shares at the support, but i ended up not pulling the trigger because the bears were clearly dominating the day. Who knows, this may have been a really good opportunity that i missed. This could mark a bounce which would mean that we're on our way to testing 25 and if the bulls pushed the stock.

Above that, we would then be on our way to testing 28.6. Once again, if workhorse manages to find demand in between the region of 22.6 and 23.6, the first resistance would be a gain of almost six percent, and then this next resistance would be a gain of 21. To be very clear, though, this bullish scenario is not guaranteed. If the stock continues to fall, that could set up a test of the next support at 21.8, which would be decline of almost 8 percent and though i don't think it's likely if the bull camp doesn't get their act together at that support.

That would then set up a test of the next support region in between 19.7 and 20.4, which would be a decline of roughly 15 percent. As things currently stand, i am favoring the bullish scenario. Roth capital prompted a lot of hype and excitement with the usps contract, but when that didn't pan out the stock retracted back to the middle of the wedge, where it found demand - and i also really like how it reaffirmed the support at 22.6. Obviously, as a workhorse investor, i don't like that the stock dropped more than 20 in the past two days, but from a technical perspective, i don't see anything to be worried about, because the stock hasn't made a new lower low and, from a fundamental perspective, the 200 Million dollars in financing is definitely bullish for the company, as i've discussed in my previous workhorse videos.

My current cost basis is just above 20 and in terms of risk, i am intently watching the support at 21.8, as things continue to develop i'll, make sure to keep you updated with the new technical levels of support and resistance, and also keep you posted on what I decide to do with my shares of workhorse stock. If any of that interests, you make sure you have your notifications turned on, so you don't miss any of my future videos and another piece of comforting information is that the big players aren't selling their shares of workhorse. In fact, they're buying more rq, which is the autonomous technology and robotics etf, now owns almost 800 000 shares of workhorse, and when i last checked this a couple weeks ago, that was around 740 000.. This means that whatever has been going on recently, these professional wall street players have viewed it as an opportunity to buy 60 000 more shares of workhorse.

So if they're not running for the hills, neither am i all in all. Nothing has fundamentally changed about workhorse the stock dropped today, because the market had expectations for the usps contract to be announced, but that didn't happen. Currently, there is no set date for the usps contract announcement, but it is expected by the end of this year. Honestly, from a fundamental perspective, i would argue that workhorse is stronger than ever: they've just secured 200 million dollars in financing.

They have a process improvement, partnership with hitachi and they are hiring a lot of personnel to me. Workhorse is doing everything it needs to to seriously ramp up production. Now i would love for workhorse to win a large portion of the usps contract, but even if that doesn't happen, i'm still bullish on the company because it has so many things going for it. But with all that being said, these are my personal opinions and i'm not a financial advisor, so make sure to do your own research, because after all, it is your own money, since workhorse did have a considerable dip.

Let me know if you think it's going to bounce or fall even further, also feel free to post any suggestions or recommendations for how i can improve these videos if you're interested in my charting software and you want a free 30-day trial, there's a link in the Description of this video there's also links to the training platforms, robinhood and weeble. Weeble is currently running a deal where, if you sign up and make the initial deposit, you could potentially win a stock valued up to sixteen hundred dollars. If you enjoyed this video - and you want to support my efforts in making more, there are a few things you could do to help me out. You could drop a like leave a comment and join the moon gang by subscribing to the channel thanks for watching and until next time.

Best of luck in the markets. You.