SpaceX stock has staged a recovery from its year-to-date low of $104, climbing to around $142 in recent weeks. However, that rebound is showing signs of exhaustion, and several fundamental and technical headwinds suggest the shares could be headed for another leg down.
Technical indicators point to fading momentum
The four-hour chart reveals a loss of upside momentum. The Average Directional Index (ADX), a measure of trend strength, has dropped to 14.5 from a high of 30.7 in August. A falling ADX typically signals that the prevailing trend is losing steam, which in this case means the rally is running out of buyers.
Moreover, the price action has formed a rising wedge pattern—two ascending and converging trendlines that often precede a bearish breakout. The Percentage Price Oscillator (PPO) is also showing a bearish divergence, where the oscillator trends lower while price makes higher highs. If the wedge resolves to the downside, the stock could revisit its earlier low near $104.
Massive share unlock overhang
Another significant risk is the upcoming expiration of lockup periods. On September 9, 319 million shares are scheduled to become tradable, followed by 59 million the next day. In total, more than 2.62 billion shares will unlock this year, with additional tranches next year. Lockup expirations typically increase the supply of shares available for trading, often leading to downward pressure as insiders and early investors may sell. This overhang could weigh on the stock in the near term.
Free cash flow under pressure from heavy capex
SpaceX's capital expenditure continues to escalate, putting strain on free cash flow. In its latest quarterly report, the space segment spent over $1.17 billion on capex, up from $1.05 billion in the same quarter last year. More striking is the AI segment, which spent $15.8 billion in capex, more than double the $7.7 billion a year earlier. For the first half of the year, AI-related spending reached $23 billion as the company accelerates data center construction.
This spending is unlikely to slow, as SpaceX competes with hyperscalers and AI infrastructure providers like CoreWeave, Nebius, and Meta Platforms. The AI segment is also experiencing operational delays, prompting leadership changes. While demand from clients such as Anthropic and Google remains strong, the heavy investment phase is pressuring cash flows.
AI competition intensifies
SpaceX's AI chatbot, Grok, is losing ground to rivals. Recent data shows OpenAI and Anthropic dominate the U.S. market, while Grok and other models face increasing competition from Chinese platforms like Kimi and DeepSeek. This competitive pressure could limit the growth potential of SpaceX's AI business, which is a key driver of its valuation.
At a market capitalization approaching $1.95 trillion, the stock is trading at a premium that leaves little room for disappointment. As capex surge clouds near-term outlook, investors may be reassessing the risk-reward balance. Some analysts remain optimistic, with AI revenue forecasts suggesting doubling potential, but the immediate technical and supply dynamics are concerning.
With Starlink nearing 11,000 satellites, the core business continues to expand, but the unlock and capex risks are hard to ignore. The combination of a weakening technical setup, a wave of share supply, and persistent cash burn paints a cautious picture for the coming months.
This article is for informational purposes only and does not constitute financial advice.
