Nike Soars 3.79%—Is This the Start of a Bullish Rebound?

Summary
• Nike (NKE) surges 3.79% intraday to $79.16, breaking above 200-day MA of $70.83
• JPMorgan upgrades to 'overweight' with $93 price target, citing 'Win Now' strategy
• Options frenzy: 3249 contracts traded for NKE20250801C80, 5263 for NKE20250801C81
• Turnover spikes to 10.36 million shares, 0.89% of float

Nike's 3.79% rally has ignited a frenzy in the options pits and retail investor circles, driven by JPMorgan's bold upgrade and management's confident 'Win Now' strategy. With the stock trading above $79—a level not seen in four years—investors are debating whether this is a sustainable rebound or a short-lived bounce. The $79.99 intraday high and $77.56 low highlight the volatility, while the options market tells a story of aggressive bullish positioning.

JPMorgan Upgrade Ignites Retailer's Turnaround Optimism
Nike's 3.79% surge is directly tied to JPMorgan's 'overweight' upgrade and $93 price target, a 30% upside from current levels. The firm cited five pillars of Nike's 'Win Now' strategy: inventory alignment, wholesale orderbook acceleration, and product innovation ahead of the 2026 World Cup. This follows Q4 FY2025 results where revenue beat estimates despite 12% YoY decline, and cash reserves of $9.2 billion. The upgrade comes as management expects inventory pressures to ease mid-2026, with operating margins potentially doubling to 10% by 2028. This catalyst has reignited confidence in Nike's ability to navigate tariffs and macroeconomic headwinds.

Apparel Sector Mixed as Under Armour Drags
While Nike rallies, the Apparel, Accessories, and Luxury Goods sector shows mixed signals. Sector leader Under Armour (UAA) declines 1.9%, highlighting divergent momentum. Luxury peers like LVMH report 12% revenue declines in their fashion segment, signaling broader industry headwinds. Nike's outperformance stems from its specific 'Win Now' strategy and JPMorgan's bullish thesis, contrasting with LVMH's cautious guidance and Loro Piana's supply chain controversies. The sector's 52-week low of $52.28 for Nike suggests a potential inflection point, but broader macroeconomic factors including tariffs and consumer spending shifts remain critical.

Options Playbook: Leverage 99.1% Leveraged Calls and 14.8% Leverage Calls
• RSI: 49.11 (neutral) • MACD: 2.67 (bullish) • 200D MA: $70.83 (below price) • Bollinger Bands: $70.34–$77.68 (current price above band) • Gamma: 0.1398 (high sensitivity) • IV: 29.94% (moderate)

The technicals show Nike in a short-term bullish trend, with key support at $72.27 and resistance at $77.19. The 200D MA is a strong floor, while the $79.99 intraday high suggests momentum could continue. With JPMorgan's $93 target implying 20% upside, the most compelling options are those with high leverage and moderate delta. Two top picks from the chain:

• NKE20250801C80 (Call, $80 strike, 2025-08-01):
- IV: 29.94% (moderate)
- LVR: 99.10% (high)
- Delta: 0.408 (moderate sensitivity)
- Theta: -0.253 (rapid time decay)
- Gamma: 0.1398 (high sensitivity)
- Turnover: $374,628 (liquid)
- Projected 5% upside payoff: $4.58/share
- This contract balances leverage with moderate delta, ideal for a 5-7% move.

• NKE20250801C81 (Call, $81 strike, 2025-08-01):
- IV: 29.27% (moderate)
- LVR: 176.18% (very high)
- Delta: 0.274 (low sensitivity)
- Theta: -0.189 (moderate decay)
- Gamma: 0.1227 (high sensitivity)
- Turnover: $100,536 (liquid)
- Projected 5% upside payoff: $5.38/share
- Offers explosive potential if the $80 level holds, with high leverage amplifying gains.

Aggressive bulls should consider NKE20250801C81 into a breakout above $80.50, while balanced positions in NKE20250801C80 offer better risk-reward for a 5-7% move.

Backtest NIKE Stock Performance
The backtest of Nike (NKE) following a 4% intraday increase shows poor performance, with a strategy return of -21.37% and an excess return of -110.11%. The strategy underperformed the benchmark significantly, and the Sharpe ratio was -0.14, indicating a high risk-adjusted return. The maximum drawdown was 0.00%, which suggests that the strategy had no room to risk further declines.

Bullish Momentum Builds—Watch for $80 Breakout
Nike's 3.79% rally is driven by a confluence of strategic clarity, analyst upgrades, and strong cash reserves. The $79.99 intraday high suggests momentum could extend toward JPMorgan's $93 target, but traders must watch for pullbacks to $77.19 (200D resistance). The sector's mixed performance, highlighted by Under Armour's -1.9% drag, underscores the importance of Nike's unique catalysts. For now, the 200D MA at $70.83 remains a critical floor, while the $79.16 current price suggests a 12% buffer to the 52W low. Aggressive bulls should monitor the $80.50 level—break above it and the 99.1% leveraged NKE20250801C80 could amplify gains.