Aurora Innovation Plummets 5.5%: Is the Auto Tech Sector Facing a Correction?

Summary
• Aurora Innovation (AUR) trades at $5.65, down 5.5% from its previous close of $5.98
• Intraday range spans $5.61–$5.97, signaling sharp bearish momentum
• Options volatility surges, with 2025-09-19 contracts showing 68.62% implied volatility
• Auto sector peers like Mobileye Global (MBLY) also decline 2.3%, hinting at broader pressure

Aurora Innovation’s steep intraday decline has ignited a wave of bearish speculation, with the stock trading near its 52-week low of $3.81. The selloff coincides with a technical breakdown below key moving averages and a surge in bearish options activity. As the EV sector grapples with regulatory uncertainty and shifting consumer demand, investors are scrambling to assess whether this is a buying opportunity or a deeper correction.

Technical Breakdown and Sector Jitters Fuel Sharp Selloff
Aurora Innovation’s 5.5% intraday decline reflects deteriorating technical momentum, with the stock now trading below its 200-day moving average of $6.51 and 30-day average of $6.08. The MACD histogram (-0.0065) and RSI (54.55) suggest weakening bullish conviction, while Bollinger Bands show the price is near the lower bound at $5.658. This breakdown aligns with broader sector jitters, as automakers face mounting pressure from Trump-era tariffs and shifting EV demand dynamics. The stock’s sharp drop also coincides with heightened bearish options activity, particularly in the 2025-09-19 expiration cycle, where put options with 68.62% implied volatility dominate trading.

EV Sector Mixed as Consumer Confidence Wanes
The broader auto technology sector is experiencing a synchronized selloff, with sector leader Mobileye Global (MBLY) down 2.3%. This decline mirrors Aurora’s technical breakdown, as EV-focused firms face renewed skepticism over profitability and regulatory hurdles. While Aurora’s drop is more pronounced, the sector-wide weakness suggests macroeconomic factors—such as Trump’s auto tariffs and softening consumer demand for EVs—are amplifying the sell-off. The S&P 500’s -0.44% decline further underscores a risk-off market environment.

Bearish Options Playbook: Leveraging Volatility in a Downtrend
• 200-day MA: $6.51 (below) • RSI: 54.55 (neutral) • MACD Histogram: -0.0065 (bearish) • Bollinger Bands: $5.658 (lower bound) • Turnover Rate: 1.738% (high liquidity)

Aurora Innovation’s technical breakdown below key moving averages and Bollinger Bands suggests a high probability of continued bearish momentum in the near term. Investors should monitor the $5.62 intraday low as a critical support level; a break below this could trigger a test of the 52-week low at $3.81. Conversely, a rebound above $5.97 may attract short-covering buyers. Given the sector leader Mobileye Global’s 2.3% decline, broader auto tech weakness could amplify AUR’s volatility.

Top Options Picks:
• AUR20250919P6 (Put):
- Strike: $6.00 • IV: 68.62% • Leverage: 9.19% • Delta: -0.5567 • Theta: -0.001996 • Gamma: 0.3467 • Turnover: 3,750
- IV (Implied Volatility): High volatility suggests strong bearish expectations
- Leverage: High return potential on a price drop
- Delta: Moderate sensitivity to price declines
- Gamma: High sensitivity to price movement changes
- Turnover: High liquidity ensures easy entry/exit
- Payoff Analysis: A 5% downside to $5.35 would yield a $0.65 profit per contract, offering 18.6% return on the $3.54 premium.
- Why It Stands Out: This put option is ideal for capitalizing on a potential breakdown below $5.65, with high leverage and liquidity to manage risk.

• AUR20250919C5.5 (Call):
- Strike: $5.50 • IV: 66.93% • Leverage: 10.35% • Delta: 0.6159 • Theta: -0.010946 • Gamma: 0.3438 • Turnover: 3,299
- IV (Implied Volatility): Elevated volatility reflects market uncertainty
- Leverage: High return potential on a price rebound
- Delta: Strong responsiveness to price rallies
- Gamma: High sensitivity to price movement changes
- Turnover: High liquidity ensures easy entry/exit
- Payoff Analysis: A 5% rebound to $5.92 would yield a $0.42 profit, offering a 17.1% return on the $2.45 premium.
- Why It Stands Out: This call option provides a balanced play on a potential bounce above $5.65, with sufficient liquidity for entry/exit.

Action Insight: Aggressive bears should target the AUR20250919P6 put for a breakdown below $5.65, while cautious bulls may use the AUR20250919C5.5 call as a hedge if the stock tests support at $5.62.

Backtest Aurora Innovation Stock Performance
The backtest of AUR's performance after an intraday plunge of -6% shows no impact on the entire market, with a maximum return of 5.01% on the maximum return day. This indicates that such a significant intraday decline did not lead to a prolonged negative trend in the market.

Aurora Innovation at Crossroads: Watch for $5.62 Breakdown or Sector Rally
Aurora Innovation’s technical breakdown and sector-wide weakness suggest a high probability of continued bearish momentum in the near term. The stock’s proximity to its 52-week low and elevated bearish options activity indicate a critical juncture for the name. Investors should prioritize the AUR20250919P6 put for a breakdown below $5.65, while hedging with the AUR20250919C5.5 call if the stock stabilizes above $5.62. The sector leader Mobileye Global’s 2.3% decline further underscores the need for caution. Watch for a $5.62 breakdown or a sector rally led by MBLY to determine the next move.