Coherent Plunges 5.3% Amid Sector Turbulence: What's Fueling the Selloff?

Summary
• Coherent (COHR) tumbles 5.3% intraday to $90.14, breaching its 200-day moving average of $86.16
• Sector leader Keysight (KEYS) declines 1.84%, signaling broader industry pressure
• Options chain shows aggressive put buying at $90 strike, with 92.11% price change ratio
• RSI at 29.2 suggests oversold conditions, but MACD (-2.33) and negative histogram (-1.2) confirm bearish momentum
Coherent’s sharp intraday selloff has drawn attention as the stock trades near its 52-week low of $45.58. The move coincides with a broader sector correction, led by Keysight’s decline. With technical indicators flashing bearish signals and options activity intensifying, investors are scrambling to decipher whether this is a short-term correction or a deeper structural shift.

Sector-Wide Weakness and Technical Deterioration
Coherent’s 5.3% drop reflects a broader selloff in the Electronic Equipment sector, driven by Keysight’s 1.84% decline and a lack of catalysts in the sector news. While no company-specific news triggered the move, technical deterioration is evident: the stock has pierced its 200-day MA, sits below the Bollinger Band lower bound ($77.49), and faces immediate resistance at $90.15–90.75. The negative MACD (-2.33) and oversold RSI (29.2) suggest a continuation of downward momentum unless buyers step in above $90.15.

Electronic Equipment Sector Under Pressure as Keysight Drags
The Electronic Equipment sector is broadly underperforming, with Keysight (KEYS) down 1.84% and Coherent (-5.31%) amplifying the selloff. While no single event triggered the move, sector-wide profit-taking and macroeconomic concerns (e.g., Nvidia’s Q2 growth slowing) have created a risk-off environment. Coherent’s 52-week range of $45.58–$123.25 suggests it remains in a long-term consolidation phase, but the recent breakdown below key support levels raises concerns about near-term stability.

Bearish Options Play and ETF Positioning for Volatility
• 200-day MA: $86.16 (below current price)
• RSI: 29.2 (oversold)
• MACD: -2.33 (bearish), Signal Line: -1.13, Histogram: -1.2 (negative divergence)
• Bollinger Bands: $77.49 (lower), $99.50 (middle), $121.52 (upper)
• Key Support/Resistance: $90.15–90.75 (30D), $99.41–100.72 (200D)
Coherent’s technical profile favors a short-term bearish bias, with the 200-day MA ($86.16) and Bollinger Band lower bound ($77.49) as critical targets. The options chain offers two high-conviction plays:

1. COHR20250919P90 (Put Option)
• Strike: $90, Expiration: 2025-09-19, IV: 44.92%, Leverage: 24.77%, Delta: -0.45, Theta: -0.004, Gamma: 0.0397, Turnover: $14,294
• IV (44.92%) suggests moderate volatility, Leverage (24.77%) amplifies downside potential, Delta (-0.45) balances sensitivity to price moves, and Gamma (0.0397) ensures responsiveness to further declines. Under a 5% downside scenario (to $85.63), payoff would be $4.37 per contract, offering 30.6% return on a $14,294 investment.

2. COHR20250919C95 (Call Option)
• Strike: $95, Expiration: 2025-09-19, IV: 42.24%, Leverage: 44.32%, Delta: 0.34, Theta: -0.134, Gamma: 0.0393, Turnover: $163,360
• IV (42.24%) and Leverage (44.32%) position this as a high-reward call for a rebound above $95. Delta (0.34) and Gamma (0.0393) suggest it benefits from volatility without excessive time decay (Theta: -0.134). A 5% rebound to $94.64 would yield $0.37 per contract, a 0.23% return on $163,360 turnover.

Action: Aggressive bears should prioritize the COHR20250919P90 put for a 5% downside scenario. If the stock stabilizes above $90.15, consider the COHR20250919C95 call for a short-term bounce.

Backtest Coherent Stock Performance

Urgent Action Required: Watch $90.15 Support and Sector Catalysts
Coherent’s 5.3% intraday drop has created a critical juncture for investors. The stock’s breakdown below $90.15 and 200-day MA ($86.16) signals a high-risk environment, but oversold RSI (29.2) and bearish MACD (-2.33) suggest further downside is likely. Sector leader Keysight’s 1.84% decline underscores broader industry weakness. Immediate action: short sellers should target the COHR20250919P90 put if the stock closes below $90.15, while bulls should monitor the 200-day MA ($86.16) for a potential rebound. Watch for a sector-wide catalyst—positive or negative—to determine the next move.