QuantumScape stock rally shows signs of strength

QuantumScape has rallied for two weeks after announcing successful production breakthrough.
Battery company's solid-state process is now closer to commercialization.
QS stock has rallied more than 100% since June 24.
Structure of QS rally shows that more range highs may be ahead.

Clay Webster FXStreet

QuantumScape (QS), a pre-revenue electric vehicle (EV) battery company, has seen its share price surge more than 100% since June 24, when it announced successfully reaching production targets ahead of schedule.

Shares of the San Jose, California-based company are moving slightly higher on Wednesday and reached a new 11-month high of $8.79 earlier in the session following Tuesday's more than 16% rally.

US stock markets are buoyant in the mid-week session as Nvidia (NVDA) becomes the first $4 trillion company. The NASDAQ gained over 1% earlier but trades up 0.6% at present as markets await the Federal Reserve's (Fed) Meeting Minutes from June.

QuantumScape stock news

The bullish talk surrounding QS shares follow QuantumScape's announcement on June 24 that it had achieved its goal of integrating its "advanced Cobra separator process" into baseline cell production ahead of schedule.

QuantumScape is the leading publicly-owned company in the solid-state EV battery space. It seeks to develop next-generation battery technology that it can then license to automotive partners like Volkswagen (VWAGY). Solid-state batteries are designed to be cheaper, charge faster and allow for increased density that allows for longer EV range.

The solid-state battery technology has long shown better results in the lab, but QuantumScape's latest breakthrough involves a 25x decrease in the time it takes for ceramic heat treatment in the construction of its batteries. Additionally, the new Cobra process, which replaces the company's earlier Raptor process, takes up much less production space.

“Our team has made impressive strides in advancing Cobra, a technology that exemplifies our progress in scaling solid-state battery production,” said Dr. Siva Sivaram, QuantumScape's CEO. “By significantly improving throughput and shrinking the equipment footprint, Cobra gives us a powerful path forward for commercializing our next-generation battery technology.”

QuantumScape is not expected to see revenue until 2026, but analysts project that meagre revenue to grow by 1200% when sales reach $60 million in 2027.

QuantumScape stock news

The two daily charts below show how QuantumScape stock has generally been in a secular downtrend since going public in 2020. But this downtrend is pockmarked by fairly regular seasonal spikes as the company achieves new technology milestones.

The latest rally over the past two weeks has launched QS shares well above the 50-day and 200-day Simple Moving Averages (SMAs). But the real thing to notice is that this time the rally found support in the low $6 range before breaking above the initial highs from the first two sessions of the rally. This means the rally might have legs or staying power.

QS daily stock chart YTD

Compare that to recent short-term rallies over the past two years. The rallies in January 2025, October 2024, July 2024 and January 2024 all dissipated after several sessions. But the current rally looks more like the July 2023 rally in which QuantumScape stock consolidated before shooting up to $13.86.

This shows that the recent technology breakthrough might have more staying power that the recent rallies. That July 2023 rally lasted for more than a month at the least, and if you look at its initial rise in mid-May 2023, it really lasted about two and a half months.

With QS stock reaching a range high of $8.79 on Wednesday, bulls will next look to past range highs at $9.52 (July 2024), $10.03 (January 2024) and the July 2023 peak at $13.86.

QS daily stock chart over past 30 months

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.

AUD/USD consolidates above 0.7000; remains close to monthly top

AUD/USD holds steady above 0.7000 during the Asian session on Friday, trading just below the previous day's monthly low amid diverging forces. A hawkish RBA continues to support the Aussie, while the recent decline in US bond yields keeps the US Dollar depressed near a three-week low. However, oil-driven inflation fears reinforce Fed hike bets, which, along with geopolitical risks, could benefit the safe-haven buck and cap the currency pair.

USD/JPY bounces off one-month low; climbs to 157.00 amid reviving USD demand

USD/JPY rebounds from the 156.00 neighborhood, or a one-month low touched during Friday’s Asian session, with bulls looking to extend momentum beyond 157.00 amid the emergence of some US Dollar buying. Meanwhile, Japan's National CPI rose to a nine-month peak and reaffirmed BoJ rate-hike bets, which could support the Japanese Yen and cap gains for the currency pair.

Gold treads water around $4,000

Gold prices maintain its offered stance in place at the end of the week, hovering around the key $4,000 threshold per troy ounce. The persistent selling bias in the precious metal comes amid decent gains in the US Dollar and an acceptable rebound in US Treasury yields across the curve, all alongside further upside traction in crude oil prices.

Crypto Today: Bitcoin holds the 50-day EMA as Ethereum and XRP face structural resistance

Bitcoin gradually ticks up on Friday, trading above $81,000. The Crypto King has recently defended structural support near $80,000, reinforcing the prevailing bullish outlook. Ethereum similarly edges higher above $2,400, while Ripple trades above $1.32 after testing support around $1.30.

The French bond panic is overdone. Here's what the market is misreading

France's 10-year government bond yield has climbed above 5%, reigniting fears of a sovereign debt crisis in the Eurozone. With public debt exceeding €3.5 trillion, persistent budget deficits and a fragmented political landscape, investors are increasingly questioning the French government's ability to stabilize its finances.

What November 3 means for the Fed's rate path and the US Dollar

The USD faces a decisive period ahead of the November 3 midterm elections. While markets anticipate another interest rate increase from the Fed in December, the battle for control of Congress could reshape fiscal policy expectations and, indirectly, the path of US monetary policy in 2027.