Nasdaq rewrote the playbook for SpaceX.

The world's largest IPO is entering the Nasdaq-100 (^NDX) only 15 trading days after it started trading, pulling SpaceX (SPCX) into one of the market's biggest passive-investing machines before most of its shares are even available to trade.

That creates a stock-price setup investors do not usually see at this scale.

Index funds are rule followers. If a fund tracks the Nasdaq-100, it has to own the Nasdaq-100 component stocks. When SpaceX goes in, funds tied to the index need to buy SpaceX and trim other holdings so the portfolio still matches the benchmark.

That process is called rebalancing, and for SpaceX it could mean billions of dollars of forced buying. JPMorgan has estimated about $4.3 billion of passive demand tied to Nasdaq-100 inclusion, while BNP Paribas put the potential buying across Nasdaq-100 trackers closer to $8 billion.

The catch is supply.

Only a small slice of SpaceX shares was initially available for public trading. The rest is held by insiders, employees, early investors, and other locked-up holders who are not yet free to sell most of their stock into the market.

That tradable slice is often called the float. In plain English, it is the stock that investors can actually buy and sell.

The chart shows the timing issue. Index-fund buying arrives first. More tradable shares arrive later as restrictions lift, starting with a major unlock in August and larger waves later this year.

That sequence can support the stock in the short term because required buyers are showing up while supply is still tight. But it also means the current price is not the final test of demand.

SpaceX has already shown how fast the trade can turn. After becoming retail's biggest IPO trade, the stock quickly surged 50% in its first three trading days before giving nearly all of it back over the following three days.

The next price test is the $172 to $180 zone, a potential ceiling based on several technical measures and price action over the last two weeks. A break above that zone would put the record closing high just above $200 back in play.

Below that area, the stock likely stays choppy. Under $150, the chart starts sending a much more bearish message.

Jared Blikre is the global markets and data editor for Yahoo Finance. Follow him on X at @SPYJared or email him at [email protected].

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