Palantir's Volatile Slide: Can the AI Powerhouse Weather the Storm?

Summary
• PLTR plunges 2.59% to $172.59, breaking below its 52-week high of $190
• Citron Research slams PLTR as 'beyond overvalued' in new short-seller report
• Q2 revenue hits $1B milestone, GAAP profitable for 8th straight quarter
• Options chain shows extreme volatility with 45%+ implied volatility on key strikes

Palantir Technologies (PLTR) is caught in a high-stakes tug-of-war between bearish short-seller attacks and bullish catalysts. The stock’s 2.59% intraday drop to $172.59—its lowest since mid-July—reflects growing skepticism over its 135x sales valuation. Yet government contracts and AI-driven growth remain potent tailwinds. With the stock trading near its 52-week low of $29.31 and a dynamic PE of 378x, the battle for PLTR’s future is heating up.

Short-Seller Report Clashes with Bullish Catalysts
Citron Research’s latest bearish assault on PLTR has ignited a firestorm, labeling the stock 'beyond overvalued' despite its $1B quarterly revenue milestone. The firm argues PLTR’s 135x sales multiple is unsustainable, comparing it to OpenAI’s 17x valuation multiple. Meanwhile, bullish forces are fueled by President Trump’s $175B Golden Dome missile defense plan, which could supercharge demand for PLTR’s SHIELD initiative. The stock’s 2.59% drop reflects market uncertainty as short-sellers and long-term believers clash over PLTR’s AI-driven growth narrative.

Options Playbook: Navigating PLTR's Volatility with Precision
• MACD: 10.14 (above signal line 9.59), RSI: 66.23 (neutral), Bollinger Bands: $194.75 (upper), $167.47 (middle), $140.19 (lower)
• 30D MA: $160.40 (below price), 100D MA: $129.30 (far below)

PLTR’s technicals suggest a short-term bearish trend with key support at $167.47 (middle Bollinger Band) and resistance at $194.75. The stock’s 2.23% turnover rate and 48.46M volume indicate moderate liquidity. For leveraged exposure, the Direxion Daily PLTR Bull 2X Shares (PLTU) offers 2x leverage but has plummeted 5.21% today, reflecting market jitters.

Top Option 1: PLTR20250822C175
• Code: PLTR20250822C175
• Type: Call
• Strike: $175
• Expiry: 2025-08-22
• IV: 45.41% (moderate)
• LVR: 61.77% (high)
• Delta: 0.427 (moderate)
• Theta: -0.977 (high decay)
• Gamma: 0.0427 (high sensitivity)
• Turnover: $7.61M (liquid)
• Payoff (5% down): $1.25 (max(0, 163.95 - 175))
This call option offers high leverage and liquidity, ideal for capitalizing on a potential rebound above $175. The high gamma ensures sensitivity to price swings, while the moderate IV balances risk and reward.

Top Option 2: PLTR20250822C172.5
• Code: PLTR20250822C172.5
• Type: Call
• Strike: $172.5
• Expiry: 2025-08-22
• IV: 46.05% (moderate)
• LVR: 43.24% (high)
• Delta: 0.535 (moderate)
• Theta: -1.137 (high decay)
• Gamma: 0.0426 (high sensitivity)
• Turnover: $5.01M (liquid)
• Payoff (5% down): $0.00 (max(0, 163.95 - 172.5))
This strike offers a tighter risk-reward profile, with a 43.24% leverage ratio and high gamma to capture volatility. However, a 5% downside would result in zero payoff, making it a high-risk, high-reward play.

Aggressive bulls should consider PLTR20250822C175 into a break above $175.

Backtest Palantir Stock Performance
The backtest of Palantir (PLTR) after an intraday plunge of at least -3% shows favorable performance over various short-term horizons. The 3-Day win rate is 68.18%, the 10-Day win rate is 71.21%, and the 30-Day win rate is 89.39%. While the maximum return during the backtest period was 38.34% over 30 days, the average returns were more modest, at 3.14% over 3 days and 7.40% over 10 days. These results suggest that following a -3% intraday plunge, PLTR tends to recover and even exceed its previous price levels, making it a potentially attractive entry point for short-term investors.

Palantir at the Crossroads: Strategic Moves for the Coming Weeks
PLTR’s current volatility reflects a critical inflection point between short-term bearish sentiment and long-term AI-driven growth potential. The stock’s 2.59% drop to $172.59 tests key support at $167.47, with a breakdown below $171.39 (intraday low) signaling deeper weakness. Meanwhile, the sector leader Microsoft (MSFT) fell 0.79%, highlighting broader tech sector caution. Investors should monitor the 52-week high retest at $190 and Citron’s short-seller report for catalysts. Watch for a breakdown below $171.39 or regulatory reaction to the Golden Dome contract.