Carvana (CVNA) Surges 2.75% on Amazon-Hertz Disruption: Is This the Start of a New Bull Run?

Summary
• Carvana’s stock jumps 2.75% to $355.425, trading near its 52-week high of $413.335
• Intraday range spans $350.665 to $363.221, signaling strong short-term volatility
• Amazon’s partnership with Hertz to sell used cars sparks sector-wide speculation

Carvana’s sharp intraday rally has ignited investor curiosity amid a broader sector shift. The stock’s 2.75% gain—driven by a $10.515 surge from its October 15 open—positions it as a focal point in the evolving automotive e-commerce landscape. With Amazon’s recent foray into used car sales via Hertz, market participants are recalibrating their strategies, creating a pivotal inflection point for Carvana’s same-day delivery and inspection model.

Amazon-Hertz Alliance Sparks Sector-Wide Reassessment
Carvana’s intraday surge follows Amazon’s announcement of a partnership with Hertz to sell used vehicles directly to consumers. This move threatens to disrupt Carvana’s core business model, which relies on same-day delivery and in-person inspections. While the stock initially dipped on August 20 amid similar news, today’s rally suggests short-term traders are betting on a potential rebound in consumer confidence. The stock’s 2.75% gain reflects a mix of speculative positioning and optimism around Carvana’s recent expansion of same-day delivery to Salt Lake City and Seattle, which may differentiate it from Amazon’s more scalable but less personalized approach.

Auto Dealership Sector Volatile as Carmax (KMX) Outperforms
The broader auto dealership sector remains fragmented, with Carmax (KMX) rising 1.11% as investors favor its physical retail footprint over Carvana’s digital-first model. While Carvana’s 2.75% gain suggests some resilience, Carmax’s stronger performance highlights lingering skepticism about the sustainability of online-only car sales. Amazon’s entry into the market has amplified this divide, with Carmax’s 1,800+ physical locations offering a tangible advantage in an era of rising consumer demand for in-person vehicle inspections.

Options Playbook: Leveraging Volatility in a Ranging Market
• MACD: -5.568 (bearish divergence), Signal Line: -0.0198 (neutral), Histogram: -5.548 (negative momentum)
• RSI: 40.15 (oversold territory), Bollinger Bands: $335.62 (lower) to $408.64 (upper), 200D MA: $288.27 (well below current price)
• 30D MA: $370.07 (resistance), 200D MA: $288.27 (strong support)

Carvana’s technical profile suggests a short-term bounce from oversold RSI levels but a long-term range-bound pattern. The stock is trading above its 30D MA but far from its 200D MA, indicating a potential consolidation phase. For options traders, the CVNA20251024C365 call and CVNA20251024P350 put stand out:

• CVNA20251024C365 (Call):
- Strike: $365, Expiration: 2025-10-24, IV: 63.55% (moderate), Delta: 0.4006 (moderate sensitivity), Theta: -1.2476 (high time decay), Gamma: 0.0104 (moderate price sensitivity), Turnover: $50,788
- Leverage Ratio: 35.31% (high), Price Change Ratio: +26.58% (bullish)
- This call offers asymmetric upside if Carvana breaks above $365, with high leverage amplifying gains. The moderate delta ensures it reacts meaningfully to price swings, while the high theta warns of rapid time decay—ideal for a short-term breakout play.

• CVNA20251024P350 (Put):
- Strike: $350, Expiration: 2025-10-24, IV: 67.51% (high), Delta: -0.4424 (moderate sensitivity), Theta: -0.0931 (moderate time decay), Gamma: 0.0100 (moderate price sensitivity), Turnover: $77,071
- Leverage Ratio: 25.28% (moderate), Price Change Ratio: -21.58% (bearish)
- This put provides downside protection if Amazon’s market share gains accelerate. The high IV and moderate delta make it responsive to volatility, while the high turnover ensures liquidity for entry/exit. A 5% upside scenario (to $373.19) would yield a $18.19 payoff for the call, while a 5% downside (to $337.68) would yield a $12.32 payoff for the put.

Aggressive bulls should consider CVNA20251024C365 into a break above $365, while cautious bears may short CVNA20251024P350 if the stock dips below $350.

Backtest Carvana Stock Performance
The back-test is ready. You can review the interactive report below for full statistics and trade-level details.Key observations (not duplicating the table inside the module):• The gap-up strategy on CVNA has delivered a very strong cumulative return since 2022, but the equity curve is highly volatile and experienced deep drawdowns. • Risk controls (10 % stop-loss / 20 % take-profit / max-hold 10 days) helped cap several losses, yet the strategy still faces substantial downside risk during broad sell-offs. • Consider tightening exits or adding a trend filter if you wish to smooth the equity curve.Feel free to explore the report and let me know if you’d like to adjust the parameters or dig deeper into specific trade periods.

Breakout or Bounce? Key Levels to Watch Before October 24
Carvana’s 2.75% intraday surge reflects a fragile balance between optimism over its same-day delivery expansion and skepticism about Amazon’s disruptive potential. While the stock’s RSI in oversold territory and MACD divergence hint at a potential rebound, the long-term ranging pattern suggests caution. Investors should monitor the 30D MA at $370.07 as a critical resistance level and the 200D MA at $288.27 as a floor. Carmax’s 1.11% gain underscores the sector’s preference for physical retail, but Carvana’s digital-first edge could yet surprise. Aggressive bulls should target a $365 breakout with CVNA20251024C365, while bears should watch for a breakdown below $350.