Adaptive Plummets 11.7% Amid AI Sector Turbulence: What's Fueling the Selloff?

Summary
• Adaptive (ADPT) trades at $15.415, down 11.7% from its previous close of $17.46
• Intraday range spans $15.38 to $16.25, reflecting sharp volatility
• Turnover hits 3.5 million shares, signaling heightened investor activity

Adaptive’s dramatic intraday selloff has drawn attention as the stock collapses into its 52-week low range. With the Application Software sector grappling with AI-driven uncertainty and regulatory scrutiny, ADPT’s move mirrors broader tech sector jitters. The stock’s technicals and options activity suggest a pivotal moment for traders navigating this volatile landscape.

AI Sector Volatility Drives Sharp Decline in Adaptive
The selloff in ADPT aligns with broader Application Software sector turbulence, as recent news highlights growing skepticism toward AI-driven business models. Microsoft’s struggles to scale enterprise AI adoption and IBM’s pivot to open-source alternatives signal shifting investor sentiment. Meanwhile, regulatory concerns over data center expansion in rural Wisconsin and AI ethics debates have amplified sector-wide caution. ADPT’s price action reflects these macro pressures, compounded by its own technical vulnerabilities near key support levels.

Application Software Sector Mixed as AI Uncertainty Lingers
While Salesforce (CRM) surged 5.3% on strong enterprise demand, ADPT’s collapse underscores divergent sector dynamics. Companies like Adobe and Intuit have secured AI partnerships, but ADPT’s lack of comparable news has left it exposed to broader tech sector rotation. The sector’s mixed performance highlights the fragility of AI-driven narratives amid regulatory and execution risks.

Options Playbook: Navigating ADPT's Volatility with Strategic Contracts
• MACD: 0.745 (above signal line 0.687), RSI: 65.3 (neutral), Bollinger Bands: 11.798–21.417 (current price near lower band)
• 200D MA: $11.596 (below current price), 30D Support: $17.085–17.220

ADPT’s technicals suggest a short-term bearish bias but long-term bullish potential. Key levels to monitor include the 200-day moving average ($11.596) and 30-day support ($17.085). The stock’s high implied volatility (IV) and wide Bollinger Bands indicate elevated risk/reward for options traders.

Top Options Picks:
• ADPT20251219P15 (Put, $15 strike, 12/19 expiry):
- IV: 68.88% (moderate), Leverage: 25.88%, Delta: -0.370, Theta: -0.0099, Gamma: 0.1741, Turnover: $570
- IV indicates reasonable volatility, Leverage amplifies downside potential, Gamma ensures sensitivity to price swings
- This contract offers asymmetric risk/reward for a 5% downside scenario: Put Payoff = $0.59 (K - ST = $15 - $14.64).
• ADPT20260116P17.5 (Put, $17.5 strike, 1/16 expiry):
- IV: 72.37% (high), Leverage: 5.67%, Delta: -0.632, Theta: -0.0049, Gamma: 0.0977, Turnover: $900
- IV suggests strong bearish sentiment, Delta indicates deep in-the-money positioning, Turnover ensures liquidity
- For a 5% downside, Put Payoff = $2.86 (K - ST = $17.5 - $14.64).

Aggressive bears should prioritize ADPT20251219P15 for near-term volatility capture, while longer-term positioning favors ADPT20260116P17.5. If $15.415 breaks below $15.38, the 12/19 put offers immediate short-side potential.

Backtest Adaptive Stock Performance
I attempted to retrieve raw price data for ADPT so I could automatically identify every –12 % intraday plunge since 2022, but the data-download interface returned an error. To keep the back-test moving forward, we have two practical fallback options:1. Daily-close proxy • Define an “event” as any trading day where the closing price falls at least 12 % versus the prior-day close. • Pros: I can pull this from an alternative source that usually works. • Cons: May catch days with a big gap-down close rather than a true intraday spike.2. User-supplied dates • If you already know (or can quickly export) the exact dates when ADPT traded ≥ 12 % below its previous close at any point intraday, just paste the list and I’ll run the event back-test directly.Please let me know which approach you prefer (or if you’d like a different threshold/definition).

Act Now: ADPT's Crucial Support Levels and Sector Signals
ADPT’s selloff reflects both sector-wide AI skepticism and its own technical fragility. While the 200-day MA ($11.596) and 30-day support ($17.085) remain critical, the stock’s high IV and bearish momentum indicators suggest continued near-term pressure. Traders should monitor Salesforce’s 5.3% surge as a sector barometer—positive momentum in CRM could signal a broader tech rebound. For ADPT, a close below $15.38 would validate a breakdown scenario, making the 12/19 put a high-conviction play. Watch for $15.38 support and sector leadership shifts in the next 48 hours.