Starfighters Space Inc. (FJET) is giving back gains Tuesday morning, retreating after Monday's absolutely bonkers session where shares skyrocketed over 300% to hit $31.50. Welcome to the wild world of post-IPO trading.

What's Driving the Volatility?

Tuesday's sharp correction follows a session of intense buying driven by broader momentum in the space sector, including major contract wins for peers like Rocket Lab, and excitement surrounding Starfighters' recent IPO which raised $40 million to fund its hypersonic F-104 fleet and satellite launch operations.

The extreme instability in FJET shares is textbook behavior for newly listed companies, which often face severe volatility because the market is basically flying blind during price discovery. Unlike established stocks with years of trading data, an IPO enters the market as a blank slate. Investors have to establish support and resistance levels in real-time without any historical benchmarks to guide them.

The chaos gets amplified by liquidity dynamics, particularly when a new listing has a small float. When intense interest collides with limited supply of tradable shares, things get messy fast. Case in point: FJET traded 49.5 million shares Monday versus its 5.2 million average. That kind of volume imbalance against a constrained float drives exaggerated price movements.

The stock's movements are also being amplified by speculative psychology rather than pure fundamentals right now. Monday's rally was partially fueled by trader enthusiasm for the broader aerospace sector, spurred by rumors of upcoming listings for industry giants like SpaceX and Blue Origin.

In this post-IPO environment, price action gets dictated by momentum rather than underlying business metrics, making the stock prone to sharp corrections as early investors take profits and the initial hype fades. Which is exactly what we're seeing Tuesday.

Price Action and Technical Levels

Starfighters Space shares were down 37.78% at $19.60 at the time of publication on Tuesday, according to market data.

From a technical perspective, the current price sits notably above the established support level of $15.56, which could act as a psychological barrier for traders. However, Tuesday's sharp decline raises questions about whether the stock can maintain this support in the face of continued bearish momentum.

If the price continues to decline, the next support level to watch is around $15, where buying interest could potentially emerge from traders looking for an entry point.

How To Buy FJET Stock

If you're curious about participating in the market for Starfighters Space, whether buying shares or betting against the company, here's what you need to know.

Buying shares is straightforward through a brokerage account. Many brokers now allow you to buy fractional shares, which lets you own portions of stock without buying an entire share. In the case of Starfighters Space, which was trading at $31.50 at certain points, $100 would buy you roughly 3.17 shares of stock.

If you're looking to bet against a company, the process is more complex. You'll need access to an options trading platform, or a broker who will allow you to short a stock by lending you shares to sell. If your broker allows options trading, you can either buy a put option, or sell a call option at a strike price above where shares are currently trading. Either strategy allows you to profit from a share price decline.