Lucid Group Stock News and Forecast: LCID shares retract on Rivian recalls

EV stocks were under fire on Tuesday as news of a recall for Rivian (RIVN) injured the share prices of start-up EV makers. Tesla (TSLA) remains relatively aloof to concerns as it is at a vastly different development stage. For Rivian, Lucid (LCID) and others, it looks like Tuesday could see more recalls in their stock prices.

Lucid stock news

There has not been major news directly related to Lucid, but two key developments are hitting the stock. First, we have news of a recall for EV competitor Rivian. The recall is broad and affects nearly all Rivian vehicles produced. The issue relates to the steering column. Recalls are common and affect virtually all auto manufacturers, but in the case of Rivian it is still in the stage where it is proving its manufacturing capabilities to investors. That makes this development negatively affect the sentiment.

Lucid has no direct fallout here, but it appears start-up EV stocks are being hit in a sort of contagion move. Perhaps this can also be attributed to the other key development. The US 10-year yield once again pushed up to near 4%. Start-up companies will see their future cash flows and valuations increasingly challenged by the rise in yields. For the purposes of most cash flow calculations, the 10-year yield is the benchmark from which those calculations are made. The higher the yield goes, the lower the valuation of said stocks. Lucid stock has now broken below its yearly low and is at levels not seen since its former life as a SPAC. This adds negative momentum to the list of headwinds. 

Mainline auto manufacturers also combined to drag Lucid lower. UBS issued a negative note on General Motors (GM) and Ford (F). The Swiss investment bank shared concerns over demand destruction and said mainline US and China were not the place to be currently. 

Lucid stock forecast

The strong yearly downtrend continues. Lucid has broken yearly support at $13.25 and is approaching the low of channel support at $11.88. This is the next support level, but it is not a significant support. 

Lucid (LCID) stock chart, daily

Taking a look at the hourly chart, we can see the regression channel support at $12.20. Resistance is in the zone from previous yearly lows at $13.25 up to the double bottom at $13.58.

Lucid stock, hourly