Rivian Automotive (RIVN), known for its electric trucks and SUVs, has bounced back since hitting a low in December. The stock is currently at $21.38, up about 65% from its mid-December low of around $12-13. However, it faces three key resistance levels that could challenge its further growth. The first resistance level is $22.83, which is only $1.45 above the current price. If Rivian can break through this, the next target is $24.86, about 17% higher. Achieving this could signal strong momentum rather than just a temporary spike. The third resistance is at $28.05, which would mean a 32% gain if reached. This reflects a significant shift from the stock’s earlier consolidation in 2024. Traders are monitoring the support level at $22.83 to set realistic goals for the remaining resistance levels. If the stock can’t break through these resistance points, it may tire out, potentially dropping back to the mid-teens. Watching the trading volume is crucial; lower volume during rallies might signal fading interest. Rivian’s ability to move past these levels will be important. Each breakthrough could attract more attention, while failures might lead to profit-taking. As Rivian trades at $21.38 on Christmas Eve, the stage is set for the next few weeks. The first test will be the $22.83 resistance level, which comes during a typically quiet holiday trading period. This low volume might cause significant price swings in either direction. For those feeling positive about Rivian, the strategy is to look for a break and hold above $22.83. The recent news about exceeding our Q4 2025 production goal of 54,000 vehicles could support this move. Considering buying January 2026 call options at $23 or $24 could be a smart way to profit from a potential rise to $24.86. If the stock struggles to overcome that first hurdle, we should prepare for a bearish response. A failure at $22.83, particularly with lower volume, would indicate exhaustion similar to the failed rallies seen in summer 2024. In that case, buying puts with a $20 strike for late January could help hedge against or speculate on a pullback to the $19 support level. We must also watch implied volatility (IV), which has been rising ahead of this potential breakout. Last week’s CPI data showed inflation is easing, generally favoring growth stocks. However, Rivian’s IV suggests the market expects a significant price move, making options more expensive. This could make strategies like selling put spreads below $20 a better choice for cautious optimists. Ultimately, the target is the $28.05 level, indicating a true trend reversal after the long consolidation in 2024. A break above the second resistance at $24.86 would encourage us to consider longer-dated calls, possibly for March or April 2026. This would allow ample time for the trade to develop and take advantage of a significant upward move if the recovery is strong.

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