Rocket Lab Shot Up 460% in a Year, Then Sank 50%. Here's Its Chart

Rocket Lab shot up more than 460% over 12 months to hit a $151 all-time high on May 27, but fell back to Earth and sank some 50% in the nearly four months since then. Let's see what the space-launch firm's chart and fundamentals can tell us about what might happen next.

Rocket Lab's Fundamental Analysis

$Rocket Lab USA, Inc.(RKLB)$   released Q2 results earlier this month, posting a $0.02 adjusted loss per share on $234.1 million of revenue – easily beating the Street's expectations.

Perhaps most notably, the firm's order backlog reached $2.4 billion during the quarter, representing 137% in year-over-year growth. 

Management also guided Q3 total revenues to $250 million to $265 million. Even that range's low end came in well above the $236 million that Wall Street had been modeling.

Moving on to the balance sheet, Rocket Lab ended the quarter with $2.3 billion in cash and $266.9 million in inventories. That left the firm with about $2.9 billion in current assets, while current liabilities added up to $528.2 million.

That gave Rocket Lab current and quick ratios of 5.49 and 2.63, respectively – numbers that many fundamental analysts would see as excellent.

Oh, and the amount of long-term debt on the books comes to $14.8 million, which RKLB could easily cover with its cash on hand.

All in, most analysts would view the company's balance sheet as quite robust.

Rocket Lab's Technical Analysis

Next, let's check out RKBL's chart going back some four months and running through Monday afternoon, Aug. 17:

We will see that RKLB recently broke out of a falling-wedge pattern of bullish reversal in early August. Shaded in tan above, this pattern had been under development since late May.

Since breaking out, Rocket Lab briefly retook its 21-day Exponential Moving Average (or "EMA," marked with a green line) and 200-day Simple Moving Average (or "SMA," denoted by a red line).

Although the stock has since pulled back, retaking those lines likely juiced up enthusiasm across both the swing crowd and professional money managers.

Rocket Lab's next hurdle (or pivot) would be the stock's 50-day SMA, marked with a blue line above at $84.80 vs. the $72.57 that RKLB closed at on Friday.

Taking this line could be key to the bulls, as doing so might force a number of money managers who aren't yet back to full long-side exposure to throw in the towel and do so.

Moving on to the other technical indicators above, Rocket Lab's Relative Strength Index (the gray line marked "RSI" at the chart's top) has regained the neutral line and appears to be holding onto that move. That's a bullish signal.

Meanwhile, the stock's daily Moving Average Convergence Divergence indicator (or "MACD," marked with blue bars, a black line and a gold line at the chart's bottom) is looking much better.

For instance, the histogram of the 9-day EMA (the blue bars) took back the zero-bound in late July. That's bullish.

In addition, the 12-day EMA (the black line) has overtaken the 26-day EMA (the gold line) – another bullish sign for $Rocket Lab (RKLB.US)$.

Lastly, that 12-day line looks like it might be about to go positive. Should both the 12- and 26-day lines move into positive territory with the black line remaining above the gold one, that would amplify all of these bullish signals.

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