Oklo stock price has nosedived in the past few weeks, erasing over $12 billion in value as the market cap dropped from $25.7 billion in October to $13.7 billion. It has plunged from a high of $193 in October to $88 today.
Oklo stock dropped as investors sold shares
One reason why the Oklo share price has plunged in the past few months is that some of its shareholders have dumped it. Data compiled by Barchart shows that insiders have dumped 803,323 shares in the past three months.
At the current price, they have sold shares worth over $70 million. Also, they have dumped over 2.1 million shares in the last 12 months. These shares are currently worth over $184 million.
Some of the insiders selling the Oklo stock are Jacob Dewitte, the CEO, Caroline Cochran, the CEO, William Caroll Murphy Goodwin, the CLO, and Michael Stuart Klein.
Insider sales is usually a risky sign because it sends a message that they are not outright bullish on the company. These concerns normally escalate when these shareholders are not buying the stock.
However, insider sales are not always a bad thing as some of the sellers maintain their large positions. Others sell to fund major purchases. For example, Miriam Adelson sold over $2 billion worth of shares in Las Vegas Sands to fund her Mavericks purchase.
Increasing short interest
Oklo stock price has also crashed as investors increase their short positions on the company. Data compiled by Koyfin shows that the short interest stands at 9.20%, up sharply from 0.03% in June this year.
Increasing short interest is a sign that many investors are placing bids against the company, which they expect to deteriorate over time.
One reason for this bearishness is that the company is yet to receive authorization by American regulators.
Also, investors have shorted the company after it surged hard in the past few months. At its peak, the stock was up by over 3,343% from its lowest level in 2024. It is common for a stock to pullback after going through a major surge. A good example of this is Rolls-Royce, whose stock has pulled back after a multi-year surge.
The stock also plunged after the company published a wider-than-expected loss in the third quarter. Its loss from operations came in at $36.3 million, while its loss before income tax stood at over $29.2 million. Analysts were expecting a smaller loss than that.
Meanwhile, the number of outstanding shares has been in a strong uptrend, diluting existing investors. There are now 156 million outstanding shares, up from last year’s low of 32.3 million.
Most importantly, it is often common for companies in the pre-revenue phase to go through this volatility. A good example of this is NuScale, whose stock has dived by over 66% from the year-to-date high.
Oklo share price technical analysis
Oklo stock chart | Source: TradingView
Technical analysis also explains why the Oklo share price has remained under pressure in the past few months, falling from the year-to-date high of $194 in October to the current $90.
The stock dropped after forming a head-and-shoulders pattern, a common bearish reversal pattern in technical analysis.
It has now moved below the 50-day Exponential Moving Average (EMA) and the Major S/R pivot point of the Murrey Math Lines tool.
Also, the Relative Strength Index (RSI) and the Percentage Price Oscillator (PPO) have continued falling in the past few months. The RSI is nearing the oversold level of 30, while the PPO has moved below the zero line.
Therefore, the most likely scenario is where the Oklo share price continues falling as sellers target the next key support at $50.
In the long-term, however, the stock will likely bounce back as investors buy the dip and the authorization by American regulators happens.
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