What is Going On With LYFT Stock?

Lyft’s (LYFT) stock price witnessed a strong surge at the end of May, rising from the support level of $8 to a high of $12.78. The stock price crossed the hurdle of $11 and continued to rise, but the move was halted as soon as the price reached near $13. LYFT stock price was rising in hopes of filling the gap formed in February.

However, after facing the rejection near $13, it corrected the bullish move and fell to form a support at $10.20. The stock price attempted several times to retest the resistance level of $12.70 but remained unsuccessful.

On September 22, LYFT’s stock price finally broke the support level of $10.20. The last candle closed bullish, forming a minor support at $9.75. If the bears can push the price below $9.50, LYFT stock might melt toward the same support level from where the bullish rally started, which is $8. On the other hand, if the stock price rises above $11.50, it might retest the resistance level of $12.70.

Why Did LYFT Stock Fell in the Past Few Days?

Lyft, Inc. stock has plunged nearly 13.40% in the past five days. On September 18, the company agreed to pay $10 Million to settle a Securities and Exchange Commission investigation. The investigation was going on over a former board member’s participation in selling a large portion of LYFT’s shares before its March 2019 initial public offering.

The Securities and Exchange Commission stated that the former director was paid millions to structure and negotiate the $424 Million stock sale. The Lyft director acted as a middleman, purchasing 7.7 million shares through its affiliated investment advisor and then selling them to another investor.

Carl Icahn sold his 2.7% Lyft stake to fellow billionaire George Soros ahead of the IPO. Christodoro arranged the deal between Icahn and Soros but didn’t disclose his interest in the transaction to Lyft.

Will LYFT Stock Price Fall To $8?

The stock price dropped below 20, 50, 100, and 200-day exponential moving averages, suggesting bearish momentum. The Chaikin money flow score has also melted below the 0 mark and stands at -0.04, indicating a slight weakness in the market.

The relative strength index stands at 38.49, implying increased involvement of bears in the market. The Bollinger bands have started to expand slowly, indicating a rise in volatility.

Conclusion

The company did not admit or deny the allegation but has agreed to pay $10 Million to settle the Securities and Exchange Commission charges. Lyft’s market structure and price action have turned bearish after the break of $10.20 support.

Technical Levels

Support Levels: $9.50 and $8

Resistance Levels: $11.50 and $12.70

Disclaimer

The views and opinions stated by the author, or any people named in this article, are for informational purposes only. They do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.