It's been a mildly pleasant day for most ASX shares, as well as the All Ordinaries Index (ASX: XAO) so far this Wednesday. At the time of writing, the All Ords has put on a pleasing 0.21% and is back over 7,190 points. But let's talk about the BrainChip Holdings Ltd (ASX: BRN) share price.
Brainchip shares have exploded today. Yesterday, this All Ords tech stock closed at 18 cents each, the level it opened at this morning. But at the time of writing, those same shares are going for 23 cents apiece, a whopping 27.8% gain. Earlier in the session, Brainchip shares traded as high as 23.5 cents apiece, up over the 30% mark.
So what on earth is going on that has triggered this company to grow by almost a third within one trading day?
Well, sadly, it's a bit of a mystery. We haven't seen any fresh news out of Branchip today that might explain this eye-watering move. Or indeed any fresh news for more than a fortnight, apart from some routine ASX paperwork.
However, there are some factors that might be able to offer something of a possible explanation here.
Why has the Brainchip share price rocketed 30% today?
Firstly, most ASX tech shares are having a fantastic time on the markets today. The tech sector is currently topping the ASX sector tables, with the S&P/ASX 200 Information Technology Index (ASX: XIJ) up 1.74% at the time of writing.
We're also seeing some big moves amongst other tech stocks on the markets. For example, Weebit Nano Ltd (ASX: WBT) shares are currently up by 5.33%, while Block Inc (ASX: SQ2) stock has gained 3.21%.
These moves follow a bullish night of trading on US markets last night (our time). The American Tuesday session had stocks like Amazon gain 2% and Microsoft close in on a new all-time high.
This is probably boosting sentiment for ASX tech shares today.
But it doesn't quite explain Branchip's massive move today.
The only other thing we can point to is the trajectory Brainchip shares have been on since the start of November. The company hit a new 52-week low of 14 cents a share only last month. In October, we also saw Brainchip report a poorly received (at least at the time) quarterly update.
This saw the company reveal its cash balance had dropped by US$4 million over the three months ending 30 September to US$17.8 million.
But since 31 October, the Brainchip share price has now gained 48.4%. So it's possible that investors have decided the shares got too cheap and are flooding back into the company. It's also possible that a short squeeze is going on, given Brainchip's recent significant short-seller presence.
Whatever the reasons for today's jaw-dropping gains, no doubt Brainchip investors are feeling pretty chuffed. Even if the Brainchip share price still remains down 70% in 2023 so far.
