Aerospace company Archer Aviation (ACHR) stock took off for another 7%. The move puts Archer stock in a position to break above a critical resistance level.
Archer Aviation is a development aerospace company focused on designing and manufacturing electric vertical takeoff and landing (eVTOL) aircraft. The company’s goal is to revolutionize urban air mobility by creating a safe, efficient, and sustainable mode of transportation for cities.
Archer Aviation plans to employ electric propulsion systems to align with global sustainability goals by reducing reliance on fossil fuels and minimizing noise pollution. The company has struck partnerships with Stellantis and United Airlines (UAL).
In November, The FAA issued its final rules on the classification of "powered-lift" vehicles, including electric vertical takeoff and landing (eVTOL) aircraft like those developed by Archer Aviation, on October 22, 2024.
That designation by the FAA instantly put shares of Archer on Wall Street’s radar screen as potentially being the next Tesla. Since then, shares have rallied more than 500% to their current position just under $10.
The stock saw relatively staunch resistance at $10 Wednesday, despite strong buying volume in the early trading session.
Afternoon weakness because of the Federal Reserve Chairman’s seemingly hawkish tone brough shares of ACHR back below $10, but the selling is likely to be short-lived.
Archer Aviation shares recently saw a healthy 30% correction after their first attempt to move above the psychologically significant $10 level in the end of November. That correction has giving the stock room to rally above $10, which should increase buying interest even further.
Institutional investors are often limited in their ability to buy stocks under $10 and $5, making these prices jumping points for even more buying once they have been cleared. Shares of ACHR saw an increase in both price and trading volume as the ascended above $5 in November.
With respect to the fact that Archer Aviation is a developmental company that will trade with increased volatility, investors should consider the stock in a long-term bull market trend with its next price target at $15.
