SpaceX (SPCX) shares plunged 9.05% on November 5, 2026, falling to $120.39 and approaching August 2026 lows amid a monthly pullback exceeding 20%. The dramatic decline saw single-day trading volume surge to 167 million shares, as the stock relentlessly broke below the $130 threshold and $135 IPO price. This represents a significant escalation from the previous 6% bounce on Friday, with the stock now testing critical technical support levels.
The latest decline stems from multiple factors including U.S. midterm election results showing Democrats retaking the House of Representatives and securing Senate control. Markets worry that the new Congress will intensify budgetary and ethical scrutiny over SpaceX's major federal contracts, including U.S. Department of Defense national security launch contracts, NASA's Artemis lunar program funding, and the FCC's reassessment of Starlink rural broadband subsidies. This shifting political landscape has eroded the market's previous 'policy premium' for SpaceX's government work, which Musk previously stated represents less than 5% of annual revenue.
Since mid-October, reports disclosed that SpaceX entered into an AI GPU lease financing agreement worth up to $40 billion with private equity firms to power Starlink's computing connectivity. This massive capital expenditure has sparked Wall Street concerns over strained free cash flow and potential equity dilution, prompting capital to initiate concentrated selling on high-P/S tech stocks. The approaching lockup expiration window for early venture capital funds, internal executives, and cornerstone investors has created significant anticipatory hedging sell-offs, contributing to the recent pressure on the stock.
From a technical perspective, SPCX is currently in a bearish alignment below its $130 threshold and $135 IPO price, testing key support at $120. The stock is searching for a swing bottom and testing the 0.786 Fibonacci retracement support. If SpaceX can demonstrate strong spot dip-buying around $120, the stock will have an opportunity to halt its decline and mount a fresh rally. However, if risk-off sentiment persists or political scrutiny intensifies, secondary selling could drive the stock toward the $100 psychological threshold and historical lows.
