Digital World Acquisition Corp Stock Forecast: Executive exodus crushes DWAC shares
- DWAC stock lost nearly 30% in March.
- Two major executives quit their jobs.
- DWAC down 13% on exec announcement.
Digital World Acquisition Corp (DWAC) stock is down 13% to $55 in Monday's premarket after Reuters led with a story that two high-profile executives have decided to leave Truth Social. DWAC is the Special Purpose Acquisition Vehicle (SPAC) slated to take former President Donald Trump's Trump Media & Technology Group (TMTG) public, the latter of which owns the Truth Social media platform.
Digital World Acquisition Corp Stock News: Two major execs leave Truth Social
Josh Adams and Billy Boozer, the chief technology officer and the head of product development, respectively, have parted ways with the conservative social media startup after the Truth Social app launch in February did not go as planned. A series of technical issues and signup glitches have made for a dismal first month. Both executives left their posts after less than a year.
DWAC lost 29.9% in March after the promise of a Trumpworld social media platform failed to live up to expectations. After many would-be users were put on waitlists in February when the Truth app was first released to a select group of early adherents, CEO Devin Nunes said the app would be finalized for public release by the end of March. March came and went, and folks still seem to be on waiting lists.
"We estimate that Truth Social has so far reached approximately 1.2 million installs since its launch," research firm Sensor Tower's spokeswoman Stephanie Chan said in an interview with The Wrap.
Traffic has also plunged. The launch week saw 6 million visits, but that figure fell to 1.9 million in the last full week of March. Most observers are blaming technical issues and glitches for the lackluster user numbers. Donald Trump has 800,000 followers on the platform but has not issued a "truth" since before the launch. Various media reports suggest that daily active users sit at around half a million is no longer growing fast.
Digital World Acquisition Corp Stock Forecast: Downtrend continues
On Friday DWAC offered investors a dreadful new lower low. Though shares closed at $63.25, they dropped all the way to $59 in the first hour. This was lower than the $60.32 bottom on March 14 and makes the $60 support level obsolete. DWAC has been in a downtrend since about March 7. On March 24 there was a range high up to $74.84, but the rally had little apparent energy and turned into a lower high. This of course means that DWAC is in a downtrend.
DWAC had been in an uptrend since the beginning of the year, but March 7 put an end to that by slicing below the bottom trend line and the 21-day moving average. In the 19 sessions since then, DWAC has not once even briefly forged above the 21-day moving average. It has only closed above the 9-day moving average for a few sessions in the past month. Clearly, this price action suggests a downtrend. If that is the case, DWAC should find solace at either $50 or the area around $37-$38. With a view of the longer-term upside, bulls will target $75, $100, and $120.
DWAC 1-day chart
Author
Clay Webster
FXStreet
Clay Webster grew up in the US outside Buffalo, New York and Lancaster, Pennsylvania. He began investing after college following the 2008 financial crisis.
