The Novonix (ASX:NVX) share price just tanked 10%. What’s going on?

Why have Novonix shares tanked today?

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Key points

  • The Novonix share price has plunged almost 10% today
  • That’s despite no major news from the company
  • What could be behind this lithium battery share’s misfortune?

The S&P/ASX 200 Index (ASX: XJO) is having a pretty dreary old day on the ASX boards today thus far. As it stands at the time of writing, the ASX 200 is down by 0.97% at 7,337.1 points. But that’s nothing compared to the Novonix Ltd (ASX: NVX) share price. Novonix shares are currently down a nasty 9.7% at $9.22 a share after falling pretty consistently all day.

So why is this ASX 200 battery materials share giving back so much value today?

Well, unfortunately, it’s not entirely clear why. There have been no major news or announcements out of the company today. Or indeed since the 10 January announcement that Novonix would be initiating the process of a secondary listing on the US markets. The tech-focused Nasdaq exchange, to be specific.

At the time, this news caused quite a stir with investors, who promptly sent the shares up a healthy 7%. Novonix made the move in order to “to expand its reach to investors in the United States” and North America.

But that was then and this news is unlikely to still be influencing the Novoxnix share price. So what might be going on with this company today?

Why have Novonix shares fallen off a cliff today?

Well, it’s possible that today’s move is just the latest in the very common bouts of volatility this company has long endured. For instance, we saw a spike in Novonix shares on Monday. On that day, the shares rose close to 10% between market open and noon, only to give it all back, and then some, by the end of the trading day.

It’s not uncommon to witness this kind of volatility in companies that have enjoyed massive share price runs, and Novonix falls into this catagory. Remember, Novonix is a company that rocketed close to 650% in 2021. It remains up more than 400% over the past 12 months, and 255% over the past 6.

We also saw Novonix shares take a 30% haircut back in early December that occurred over just a few trading days, despite no obvious trigger or catalyst. Today’s moves might just be some additional volatility playing out.

Another savage selloff with some US growth shares overnight probably didn’t help either. Last night saw the NASDAQ-100 (INDEXNASDAQ: NDX) take a 2.57% dive, which would have done nothing to boost investor sentiment for the popular battery and lithium shares on the ASX. That might explain why we are seeing other players in Novonix’s space, such as Pilbara Minerals Ltd (ASX: PLS), taking large hits today.

At the current Novonix share price, this ASX 200 company has a market capitalisation of $4.48 billion.

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Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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