L3Harris Surges 4.85% Amid Bullish Momentum and Volatile Options Activity – What’s Fueling the Move?

Summary
• L3Harris (LHX) rockets 4.85% to $324.8, hitting its 52-week high of $336.6
• Intraday range spans $322.96 to $336.6, with turnover surging to 2.8 million shares
• Options chain sees explosive activity in 320–340 strike calls, with 330C330 contract trading 19,316 contracts

Today’s dramatic 4.85% rally in L3Harris has ignited a frenzy in options markets, with the stock trading near its 52-week high. The aerospace giant’s price action suggests a confluence of technical momentum and speculative positioning, as traders bet on a continuation of the upward trend. With the sector leader Lockheed Martin also up 3.98%, the broader aerospace narrative appears intact.

Technical Bullishness and Short-Term Bearish Reversal Signal
The 4.85% intraday surge in L3Harris is driven by a combination of technical factors. The stock’s price has pierced above its 30-day moving average (288.15) and is now trading near its 52-week high. A short-term bullish trend is reinforced by the MACD (6.47) remaining above the signal line (4.12), while the RSI (75.04) signals overbought conditions. However, the presence of a bearish engulfing pattern—a reversal signal—suggests caution. This duality reflects aggressive buying amid profit-taking pressures, with the 200-day moving average (263.72) acting as a distant floor.

Aerospace Sector Rally Gains Steam as LMT Trails LHX’s Momentum
The aerospace sector is experiencing broad-based strength, with L3Harris outperforming its sector leader, Lockheed Martin (LMT), which rose 3.98% today. While LMT’s rally aligns with sector-wide optimism about defense spending, LHX’s sharper move suggests idiosyncratic factors—likely technical-driven buying. The sector’s 34.89 dynamic PE ratio remains elevated, reflecting investor confidence in long-term defense sector tailwinds.

High-Leverage Call Options and ETF Positioning for a Volatile Aerospace Trade
• 200-day average: 263.72 (below current price)
• RSI: 75.04 (overbought)
• MACD: 6.47 (bullish)
• Bollinger Bands: 314.64 (upper), 293.66 (middle), 272.69 (lower)
• Key support/resistance: 278.22–279.06 (30D), 275.62–277.91 (200D)

L3Harris is trading in a high-velocity environment, with the RSI at overbought levels and the MACD histogram expanding. The 320–340 strike range in call options is the epicenter of speculative activity. Two contracts stand out for their leverage and liquidity:

• LHX20260116C320
- Strike: $320 | Expiration: 2026-01-16 | IV: 35.52% (moderate)
- Delta: 0.6185 (moderate sensitivity) | Theta: -0.9204 (high time decay)
- Gamma: 0.0210 (high sensitivity to price swings) | Turnover: 16,080
- Leverage Ratio: 32.80% (moderate)
- Payoff at 5% upside (341.04): $21.04 per contract
- Why it stands out: High gamma and moderate delta make it ideal for a continuation of the bullish move.

• LHX20260123C330
- Strike: $330 | Expiration: 2026-01-23 | IV: 26.50% (low)
- Delta: 0.3626 (low sensitivity) | Theta: -0.6080 (moderate time decay)
- Gamma: 0.0278 (high sensitivity) | Turnover: 19,316
- Leverage Ratio: 99.30% (high)
- Payoff at 5% upside (341.04): $11.04 per contract
- Why it stands out: High leverage and liquidity make it a speculative play for a breakout above $330.

Aggressive bulls should consider LHX20260116C320 into a test of $327.5 (200-day average + 10%), while those seeking higher leverage may target LHX20260123C330 if the stock breaks above $330. The sector’s strength, led by LMT’s 3.98% gain, provides a tailwind for further gains.

Backtest L3Harris Stock Performance
Here is the backtest report for LHX performance after a 5% intraday surge from 2022 to now. The key takeaways are as follows:1. Frequency of Surge: There were 290 trading days that met the condition of a ≥ 5% open-to-close surge between 2022 and 2025.2. Short-Term Performance: The strategy showed no statistical edge in the short term, with a win-rate similar to a coin flip.3. Long-Term Performance: Over a 30-day horizon, the average excess return compared to the benchmark was positive (+5.4 ppts), but it was still statistically insignificant. This suggests that while the pattern of a 5% intraday surge may have some positive momentum, it is not a reliable standalone signal for longer-term gains.

Break Above $327.5 Could Ignite a New Wave of Speculation – Act Now
The current rally in L3Harris appears sustainable in the near term, supported by a bullish MACD and overbought RSI. However, the bearish engulfing pattern warns of potential profit-taking. Investors should monitor the $327.5 level—a psychological and technical threshold—as a key inflection point. If breached, the 320–330 call options could see explosive demand. With the sector leader LMT up 3.98%, the aerospace narrative remains intact. Act now: Position in high-gamma calls (e.g., LHX20260116C320) or watch for a breakout above $330 to trigger a leveraged ETF cascade.