Gores Guggenheim Inc GGPI was soaring up more than 13% on Friday, heavily outpacing the general market, which saw the S&P 500 trading up about 0.7%.
The special purpose acquisition company (SPAC) is expected to merge with Polestar this month and list as a public company on the Nasdaq. The merger has garnered interest from traders and investors, especially after Polestar announced on June 9 that it had begun supplying Hertz Global Holdings Inc HTZ with electric vehicles.
Polestar, a Swedish electric vehicle manufacturer, will deliver 65,000 of its Polestar 2 EVs to Hertz over the next five years and plans to increase its annual sales to 290,000 vehicles by the end of 2025.
Gores Guggenheim and Polestar announced they had entered into a definitive business combination agreement on Sept. 27, 2021, a deal with an enterprise value of roughly $20 billion.
Gores Guggenheim reversed course on Friday after gapping down on Thursday and was working to print a massive bullish engulfing candlestick. Although consolidation will eventually be needed, if Gores can close the trading day over the 21-day exponential moving average, higher prices may be in the cards for next week.
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The Gores Guggenheim Chart: Gores attempted to regain support at the 21-day EMA on Friday but was struggling with the area. The SPAC did regain support at the eight-day EMA. If the stock can gain the power over the coming days to trade above the 21-day EMA, the eight-day will eventually cross above it, which would give bullish traders more confidence going forward.
- The move higher on Friday was taking place on higher-than-average volume, which indicates a high level of investor interest has returned to the SPAC. At press time, more than 5.73 million shares had exchanged hands compared to the 10-day average of 3.99 million.
- If Gores can close the trading day near its high-of-day price, the stock will print a bullish engulfing candlestick, which could indicate higher prices will come again on Monday. If the SPAC closes the trading day with a substantial upper wick, it indicates consolidation may come, possibly in the form of an inside bar.
- Gores has resistance above at $10.11 and $10.85 and support below at $9.86 and $9.73.
Photo: Courtesy Polestar
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