Rivian Stock Flashes Death Cross Pattern Despite Strong R2 Sales Growth

Rivian (NASDAQ:RIVN) stock has been in a strong downtrend this year and is now trading at its lowest level since May 21. It has slumped 30% from its July high and is on the verge of forming a death cross, despite the ongoing growth in R2 sales. Rivian’s R2 Vehicle is Seeing Strong Demand Rivian’s latest vehicle is doing well as the recent delivery numbers show. In its recent report, the company said that its total deliveries jumped to 19,248 as it made 19,751 vehicles during the quarter. These deliveries represented a 85% jump from the same period last year. Most importantly, the company reaffirmed its annual deliveries figures. It now expects to deliver between 65,000 and 70,000 vehicles this year. This is a big jump considering that the company delivered 42,247 vehicles after making 42,284. The surge is because of its R2 deliveries, which is slowly becoming popular among consumers. Rivian’s strong growth is a bright spot considering that other top companies are seeing modest growth. Tesla (NASDAQ:TSLA) made and delivered 464,391 and 486,532 vehicles, respectively. Rivian expects to sell over 25,000 R2 vehicles in the first year, making it one of the fastest launches of a new electric vehicle in the US. This is important because R2 had to succeed for Rivian to survive as an independent company. These numbers mean that Rivian’s revenue growth will continue in the coming quarters. The upcoming report is expected to show that its revenue rose by 28% in the third quarter to $2 billion. Its guidance for the third quarter is expected to be $2.5 billion, up by 93% from a year earlier. Read Also: US Treasury Yields Stabilize Ahead of Inflation Data as Experts Warn of More Volatility Rivian Stock Has Formed a Death Cross Despite This Growth On the charts, however, Rivian stock has continued falling this month and is now hovering at its lowest level since March this year. It has also formed a death cross pattern as the 50-day and 200-day moving averages have made a bearish crossover. In most cases, this pattern often leads to more downside over time. If this happens, the stock may drop to $12.66, its lowest level in May. RIVN stock chart | Source: TradingView The weak technicals is one reason why the company has a high short interest. Benzinga data shows that it has a short interest of 10.7%, meaning that many investors expect the stock to continue falling. Another reason for the weakness is the risk of further shareholder dilution. Rivian’s outstanding shares have soared to 1.36 billion from 892 million in 2022. The company sold 86.25 million shares worth $1.7 billion in July, continuing its pattern of share sales. Read Also: SpaceX Stock Pressured Despite Its Wireless Hopes as Credit Risk Jumps Image: Shutterstock