Bitfarms Surges 10.85% on Explosive Intraday Rally – What’s Fueling the Momentum?

Summary
• Bitfarms (BITF) rockets 10.85% to $2.605, piercing the $2.65 intraday high
• Defiance Daily Target 2X Long BITF ETF (BTFL) surges 22.96%, amplifying leveraged exposure
• RSI at 29.93 signals oversold rebound potential amid 52-week range of $0.673–$6.60

Bitfarms’ explosive 10.85% intraday surge has ignited market attention, with the stock trading at $2.605 as of 19:51 ET. The move follows a sharp rebound from the $2.37 intraday low, fueled by oversold technical conditions and leveraged ETF amplification. With the Defiance BITF ETF (BTFL) surging 22.96%, the rally underscores a confluence of short-term technical triggers and sector-wide momentum.

Oversold Conditions Trigger Rebound in Bitfarms Amid Range-Bound Volatility
Bitfarms’ 10.85% intraday surge is a textbook oversold rebound, driven by the RSI plummeting to 29.93—a level typically signaling short-term exhaustion. The stock’s price action near the Bollinger Bands lower boundary ($2.126) and the 200-day MA at $1.9274 further reinforced the technical setup. While the 52-week range remains intact, the MACD histogram’s slight positive shift (0.0003) and the 30D MA at $2.744 suggest a potential short-term reversal. This move reflects algorithmic buying and retail-driven momentum rather than fundamental catalysts.

Data Processing Sector Rally Led by RIOT Fuels BITF Momentum
The Data Processing & Outsourced Services sector is in sync with BITF’s surge, led by Riot Platforms (RIOT) which has surged 12.23% intraday. Both stocks are trading near their 52-week lows, suggesting a sector-wide rebound from oversold conditions. While BITF’s 10.85% gain is slightly below RIOT’s 12.23%, the correlation highlights a broader theme of algorithmic short-covering and leveraged ETF-driven buying in the space.

Leveraged ETF and Options Playbook: Capitalizing on BITF’s Oversold Rebound
• 200-day MA: $1.927 (below current price)
• RSI: 29.93 (oversold)
• Bollinger Bands: $2.126–$3.217 (price near lower boundary)
• MACD: -0.1918 (signal line: -0.1922, histogram: +0.0003)
• 30D MA: $2.744 (resistance ahead)

Bitfarms’ technicals point to a high-probability short-term rebound, with the Defiance Daily Target 2X Long BITF ETF (BTFL) offering amplified exposure. The 200-day MA at $1.927 and the 30D MA at $2.744 form a key price corridor. For options, two contracts stand out:

• BITF20260116C2.5
- Type: Call
- Strike: $2.50
- Expiration: 2026-01-16
- IV: 103.97% (high volatility)
- Leverage Ratio: 13.68% (moderate)
- Delta: 0.6178 (moderate sensitivity)
- Theta: -0.01069 (rapid time decay)
- Gamma: 0.6960 (high sensitivity to price moves)
- Turnover: 12,468 (liquid)
- Payoff at 5% upside: $0.1325 (max(0, 2.735–2.5))
- Why: High gamma and IV suggest strong short-term potential if the rebound continues.

• BITF20260116C3
- Type: Call
- Strike: $3.00
- Expiration: 2026-01-16
- IV: 30.00% (low volatility)
- Leverage Ratio: 32.50% (high)
- Delta: 0.0109 (low sensitivity)
- Theta: -0.0002 (slow time decay)
- Gamma: 0.1815 (low sensitivity)
- Turnover: 16,924 (liquid)
- Payoff at 5% upside: $0.0000 (max(0, 2.735–3.00))
- Why: High leverage ratio for aggressive bullish bets, though delta suggests limited near-term directional exposure.

Aggressive bulls should consider BITF20260116C2.5 into a break above $2.744 (30D MA).

Backtest Bitfarms Stock Performance
The backtest of BITF's performance after a 11% intraday increase from 2022 to now shows mixed results. While the stock experienced a maximum return of 9.96% on January 58, the overall win rate for 3-day, 10-day, and 30-day periods is moderate, with returns of 0.70%, 2.05%, and 5.31%, respectively. This suggests that while there is potential for gains, they are not consistently high, and the stock may experience volatility following such intraday surges.

Act Now: BITF’s Oversold Rebound and Sector Strength Signal Strategic Entry Points
Bitfarms’ 10.85% intraday surge is a high-conviction trade for short-term bulls, driven by oversold technicals and sector-wide momentum. The 200-day MA at $1.927 and the 30D MA at $2.744 form a critical price corridor to watch. With the sector leader RIOT surging 12.23%, the rally suggests a broader thematic shift. Investors should prioritize the BITF20260116C2.5 option for its high gamma and IV, while monitoring the 200-day MA as a key support level. Watch for a break above $2.744 or a retest of the $2.126 Bollinger Bands lower boundary.