Digital World Acquisition Corp Stock News and Forecast: Why is DWAC stock going up?

Digital World Acquisition Corp has taken investors on a rollercoaster ride this past week with volatility reminiscent of AMC and GameStop (GME) in their prime. Or indeed DWAC in its prime. This stock has been nothing if not volatile and that is ok with most meme stock and retail traders. Institutional traders for now are keeping their powder dry on this one. The gains this week do pale somewhat by comparison with the heady days of October. Back then DWAC surged by 356% on October 21 and followed that up with another 107% the very next day. No fading that move then. The stock then largely calmed down, a combination of trader fatigue, lack of news flow, and risk aversion dominating the market psyche. Last week saw things get interesting again though as the stock popped 28% on Wednesday, dropped 14% on Thursday, and sat out Friday for the most part. 

Digital World Acquisition Corp (DWAC) stock news

The rally this week was largely down to Congressman Devin Nunes accepting the position as CEO of Trump Media and Technology Group. DWAC is to take Trump Media & Technology public via merger. However several people have begun to question if the deal will actually go through as several SPAC deals have been called off recently and the controversy over DWAC ensures it will be highly scrutinized. The structure of the PIPE deal will also likely see the SEC take a closer look. PIPE investors in this one it appears will not be subject to a lockup period which is common in most PIPE deals. The PIPE deal would offer shares at a discount with the ability to sell them straight away. If this goes ahead it will put serious downward pressure on the share price. 

Digital world Acquisition corp (DWAC) stock forecast

This type of name is all about momentum, fundamentals are out the window here. The Trump name is a huge draw with the former President having huge followings on his social media accounts before being shut out by the major players. Trump loyalists will flock to any new social media venture. Despite losing the last election the former President still has a huge base of extremely loyal supporters. That is what DWAC stockholders are banking on.

From a purely technical perspective, there is a little volume-based resistance at $55 to $60 which held the rally last week, above $60 volume thins out so it may be easier to push on. The same volume shelf though exists below $38 and does not pick up again until below $30. So a break of $38 should be watched carefully as it will likely accelerate to the downside.