NINE Surges 21.5% on Short Squeeze and Energy Infrastructure Catalysts

Summary
• NINE rockets 21.5% to $0.576, hitting intraday high of $0.588
• Short interest jumps 15.16% to 3.19M shares, signaling bullish reversal
• Zefiro Methane’s $5M Louisiana project sparks sector optimism

Nine Energy Service (NINE) has ignited a dramatic 21.5% rally in intraday trading, driven by a short squeeze and bullish infrastructure developments. With short interest surging to 10.48% of float and Zefiro Methane’s $5M remediation project in Louisiana gaining traction, the stock’s volatility has captured market attention. Traders are now weighing technical momentum against sector-wide energy infrastructure tailwinds.

Short Covering and Zefiro’s Energy Infrastructure Play Drive NINE’s Surge
NINE’s 21.5% intraday jump is fueled by a short squeeze triggered by Zefiro Methane Corp.’s $5M Louisiana project, which positions the company to benefit from energy infrastructure expansion. Short interest in NINE has surged 15.16% to 3.19M shares, reflecting prior bearish sentiment now reversing as the stock outperforms. The project’s 90-day timeline and potential to establish P&G’s Gulf Coast presence have created a near-term catalyst, while the stock’s 66.77 RSI and bullish MACD histogram (0.0158) confirm momentum. Additionally, the stock’s 52W low of $0.2897 and -0.58 PE ratio suggest undervaluation, amplifying speculative interest.

Energy Equipment Sector Gains Momentum as SLB Rises 2.5%
The energy equipment and services sector is showing renewed strength, with Schlumberger (SLB) up 2.53% on the day. NINE’s 21.5% rally outpaces sector peers, reflecting its speculative nature and short-covering dynamics. While SLB’s technicals align with broader sector optimism, NINE’s volatility is amplified by its high short interest and small-cap profile. The sector’s 200D average of $0.6416 for NINE suggests a potential retest of key resistance levels as infrastructure-related optimism persists.

Options and ETF Strategy: Capitalizing on NINE’s Short-Term Volatility
• 200D MA: $0.6416 (above), RSI: 66.77 (neutral), MACD: 0.0035 (bullish)
• Bollinger Bands: Upper $0.4598, Middle $0.3733, Lower $0.2868
• Key support/resistance: 30D $0.3369–$0.3403, 200D $0.6239–$0.6409

NINE’s technicals suggest a short-term bullish bias, with RSI near overbought territory and MACD divergence hinting at momentum. The stock’s 11.39% turnover rate and 52W range of $0.2897–$1.78 indicate high volatility. Two options stand out for aggressive positioning:

• NINE20260220C0.5 (Call, $0.5 strike, 2026-02-20):
- IV: 30.00% (moderate), Leverage: 3.83%, Delta: 0.935 (high), Theta: -0.000597 (low decay), Gamma: 2.277 (high sensitivity)
- Turnover: 883 shares. This call offers high gamma and delta, ideal for capitalizing on a breakout above $0.5. A 5% upside to $0.605 would yield a payoff of $0.105 per share.

• NINE20260417C0.5 (Call, $0.5 strike, 2026-04-17):
- IV: 149.16% (elevated), Leverage: 2.87%, Delta: 0.717 (moderate), Theta: -0.000875 (moderate decay), Gamma: 0.779 (high sensitivity)
- Turnover: 7,769 shares. This contract balances liquidity and gamma, suitable for a mid-term hold. A 5% move to $0.605 would generate a $0.105 payoff, with IV expansion amplifying returns.

Aggressive bulls should consider NINE20260417C0.5 into a breakout above $0.5, while short-term traders may target NINE20260220C0.5 for rapid gamma-driven gains.

Backtest Nine Energy Service Stock Performance
The backtest of NINE's performance after a 22% intraday surge from 2022 to the present reveals a significant underperformance. The strategy yielded an 86.98% loss, lagging the benchmark by 129.96%. With a maximum drawdown of 98.50% and a Sharpe ratio of -0.30, the strategy indicated a high-risk, low-reward scenario.

NINE’s Short-Term Bull Case: Ride the Short Squeeze and Energy Catalysts
NINE’s 21.5% surge is a short-term inflection point driven by a short squeeze and Zefiro’s infrastructure project. Technicals favor a continuation above $0.5, with the 200D MA at $0.6416 acting as a long-term target. The energy equipment sector, led by SLB’s 2.5% rise, provides thematic support. Investors should monitor the $0.588 intraday high for a potential breakout and watch for short-covering acceleration. With implied volatility at 30%–149% and leverage ratios exceeding 2.87%, options like NINE20260417C0.5 offer high-reward setups. If $0.5 holds, the stock could retest its 52W high of $1.78 within months.