Equatorial Resources (EQX) Surges 15.58% on Intraday Rally: What’s Fueling the Momentum?

Summary
• Equatorial Resources (EQX) rockets 15.58% to $7.8479, breaking above its 52-week high of $7.90.
• Intraday range spans $7.09 to $7.90, with turnover surging to 34.05 million shares.
• Technical indicators signal bullish momentum, while options activity highlights aggressive call buying.

Equatorial Resources is experiencing a dramatic intraday reversal, driven by a confluence of technical strength and speculative positioning. The stock’s 15.58% surge has pushed it to a near-52-week peak, with options traders piling into call contracts as volatility spikes. This move occurs against a backdrop of mixed signals in the oil and gas sector, where sector leader Exxon Mobil (XOM) lags behind EQX’s explosive rally.

Technical Breakout and Bullish Momentum Drive EQX Higher
Equatorial Resources’ 15.58% intraday surge is primarily attributable to a technical breakout above its upper Bollinger Band (6.81) and a bullish MACD crossover. The stock’s price has surged past its 200-day moving average (6.20) and 30-day average (6.28), triggering algorithmic buying and retail speculation. The RSI of 64.63 suggests moderate overbought conditions, while the MACD histogram (0.057) indicates strengthening bullish momentum. High turnover (8.21% of float) further validates the move, as traders capitalize on the stock’s retesting of its 52-week high.

Oil & Gas Sector Volatility Amid Mixed Signals as XOM Trails EQX's Surge
While Equatorial Resources surges, sector leader Exxon Mobil (XOM) declines 0.29%, highlighting divergent investor sentiment. The oil and gas sector is grappling with conflicting narratives: Saudi Aramco’s Q2 production data and Permian Basin methane reductions signal environmental progress, while geopolitical tensions and U.S. tariff policies create uncertainty. EQX’s outperformance suggests its rally is driven by technical factors rather than sector-wide tailwinds, as its price action decouples from broader industry trends.

Options Playbook: Call Options on EQX20250919C7.5 and EQX20251017C7.5 Lead the Charge
• MACD: 0.1215 (above signal line 0.065), RSI: 64.63 (moderate overbought), Bollinger Bands: 6.81 (upper), 200D MA: 6.20 (below price).
• Support/Resistance: 6.10–6.12 (30D support), 6.80–6.84 (200D resistance).

EQX’s technical setup favors aggressive bullish positioning. The stock is testing its 52-week high ($7.90), with key support at $6.80 (200D MA) and resistance at $7.90. Short-term traders should monitor the 7.5 strike price as a critical pivot. Two top options stand out:

• EQX20250919C7.5 (Call):
- Strike: $7.50, Expiry: 2025-09-19, IV: 41.91%, Leverage: 12.83%, Delta: 0.66, Theta: -0.0104, Gamma: 0.35, Turnover: 385,212.
- IV (high volatility), Leverage (moderate), Delta (moderate sensitivity), Gamma (high sensitivity to price moves).
- This contract offers a 134.62% price change potential, with high liquidity and gamma to capitalize on continued momentum. A 5% upside to $8.24 would yield a payoff of $0.74 per contract.

• EQX20251017C7.5 (Call):
- Strike: $7.50, Expiry: 2025-10-17, IV: 47.58%, Leverage: 9.54%, Delta: 0.64, Theta: -0.0073, Gamma: 0.24, Turnover: 1,574,450.
- IV (elevated), Leverage (moderate), Delta (moderate), Theta (moderate time decay).
- With 112.50% price change potential and robust turnover, this option balances time decay with liquidity. A 5% upside would generate a $0.74 payoff, making it ideal for a mid-term hold.

Hook: Aggressive bulls may consider EQX20250919C7.5 into a bounce above $7.90.

Backtest Equatorial Resources Stock Performance
The backtest of EQX's performance after an intraday percentage change of more than 16% shows mixed results. While the 3-day win rate is relatively high at 50.43%, the 10-day and 30-day win rates are lower at 46.61% and 46.78%, respectively. Additionally, the returns over the 3, 10, and 30 days are negative, with the maximum return being only 0.01% over 30 days, indicating that the strategy may not consistently perform well in the short term following the intraday surge.

EQX’s Bullish Momentum: A Short-Term Play or a Sustained Run?
Equatorial Resources’ 15.58% surge reflects a technical breakout with high conviction, but sustainability hinges on holding key levels. Traders should watch the $7.90 52-week high and $6.80 support. A breakdown below $6.80 could trigger a retest of the 200D MA, while a close above $7.90 may validate a new bullish trend. Sector leader XOM’s -0.29% decline underscores the need for caution, as mixed industry signals could dampen momentum. Action: Aggressively target EQX20250919C7.5 if $7.90 holds, but monitor XOM’s performance for sector-wide cues.