Nu Holdings Soars to 13-Month High—What’s Fueling This Rally?

• NU surges 3.07% to $13.47, hitting an intraday peak of $13.53—its highest since May 2024.
• Mexico subsidiary reaches 12M customers (25% of banked population), driving sticky fintech growth.
• Artisan Partners’ Developing World Fund reports 14.4% Q2 returns, signaling institutional bullishness.
• Sector peers like MELI and Brazil ETFs slip amid Trump’s tariff threats, contrasting Nu’s outperformance.

Nu Holdings’ sharp rally defies broader fintech sector headwinds, fueled by Mexico’s market penetration milestone and institutional inflows. The stock’s 13-month high comes amid geopolitical volatility, underscoring its diversification advantage as Brazil-focused peers falter.

Mexico Milestone and Institutional Inflows Drive Rally
Nu’s surge is anchored by two catalysts: Mexico’s 12 million customers—representing 25% of the banked population—highlighting its grip on underpenetrated markets. This milestone underscores Nu’s ability to scale in high-growth Latin American economies. Second, Artisan Partners’ Developing World Fund, which reported a 14.4% Q2 return, signals sustained investor confidence. This contrasts sharply with Brazil ETFs like EWZ (-0.4%) pressured by U.S.-Brazil trade tensions, positioning Nu as a relative safe haven within fintech.

Fintech Sector Mixed Amid Brazil Trade Tensions
While Nu climbs, the fintech sector faces headwinds. MercadoLibre (MELI) and Brazil ETFs like EWZ slip on Trump’s 50% tariff threats, highlighting regional macro risks. Nu’s Mexico focus and low-cost customer acquisition model (ARPAC metrics) differentiate it from Brazil-exposed peers like StoneCo (STNE). The sector’s mixed performance underscores Nu’s geographic diversification advantage, as its 52-week high approaches while regional peers lag.

Bullish Technicals and Top Call Options to Capture Momentum
RSI: 59.19 (Neutral)
MACD: 0.237 (Bullish Histogram)
Bollinger Bands: Near Upper Band ($14.24)
30D MA: $12.71 (Support)
200D MA: $12.47 (Long-Term Trend)

Bulls aim for $13.75 resistance, with dips below $13.20 offering entry points. Two top call options stand out:

1. NU20250725C13.5: Strike $13.50, theta -0.040, gamma 0.494, IV 36.5%, turnover 9,775. Leverage ratio 38.6% offers strong upside exposure. At a 5% price swing to $14.14, this call gains $0.64/share.
2. NU20250801C13.5: Strike $13.50, theta -0.027, gamma 0.412, IV 32.2%, turnover 12,415. Lower decay risk with similar delta exposure makes it ideal for extended bullish bets. At $14.14, gains hit $0.64/share.

Avoid extreme gamma puts like P12.5 (230% leverage). Aggressive bulls target July’s C13.5 for immediacy; cautious traders favor August’s C13.5 for time decay resilience. Scale into dips below $13.20, with a stop at $12.90.

Backtest Nu Holdings Stock Performance
The backtest of NU's performance after a 3% intraday surge shows mixed results. While the 3-day win rate is high at 48.67%, the returns over the 10-day and 30-day periods are significantly lower, at 0.02% and 0.01% respectively. This suggests that while the stock may experience short-term gains, they are not consistently sustained over longer periods.

Hold Nu’s Momentum—Watch $13.75 Resistance
Nu’s breakout signals investor confidence in its Latin American growth story despite macro risks. The stock’s 14-day RSI holds in neutral territory, suggesting sustainable momentum. Bulls target $13.75 resistance, while bears may test the 30-day MA ($12.71). Monitor Brazil ETFs like BRAZ (+1.89%) for spillover risks. With institutional inflows and Mexico’s sticky growth, Nu justifies cautious optimism—buy the dip below $13.30. Sector leader PayPal (PYPL) slipped -0.6%, underscoring Nu’s outperformance. Action: Hold longs above $13.20; exit if $12.90 breaks.