Palantir Soars 3.1% on $448M Navy Contract: Is This the Catalyst for a New Bull Run?

Summary
• Palantir (PLTR) surges 3.1% to $187.49, driven by a $448M U.S. Navy contract for nuclear submarine supply chain management.
• Leveraged ETFs like Direxion Daily PLTR Bull 2X Shares (PLTU) jump 7.5%, outpacing the stock’s intraday rally.
• Technicals show a short-term bullish trend with RSI at 67.3 and MACD crossing above the signal line.

Palantir’s stock is trading at its highest level since late 2024, fueled by a landmark defense contract and growing AI adoption in government programs. The $448M Navy deal, coupled with leveraged ETFs surging 6–7%, signals strong institutional and retail momentum. Traders are now scrutinizing whether this breakout will sustain or face profit-taking pressure ahead of key resistance levels.

Navy Contract Ignites Palantir's Intraday Surge
Palantir’s 3.1% rally is directly tied to its $448 million U.S. Navy contract to manage nuclear submarine supply chains via its ShipOS platform. The deal, announced Wednesday, positions Palantir as a critical player in defense AI integration, aligning with Bank of America’s recent 'Buy' rating citing rising demand for real-time data tools in military operations. Analysts highlight the contract’s scalability, as it could unlock recurring revenue streams in the $200B+ defense software market. Meanwhile, short-term technicals—MACD crossing above the signal line and RSI near overbought territory—suggest momentum traders are capitalizing on the news-driven breakout.

Options and ETFs to Capitalize on Palantir's Momentum
• 200-day average: $142.93 (well below current price)
• RSI: 67.3 (approaching overbought)
• MACD: -0.116 (crossing above signal line at -2.38)
• Bollinger Bands: Price at 187.49 (near upper band of 190.62)
• Key support/resistance: 181.01–182.06 (30D support), 177.88–180.55 (200D support)

Palantir’s technicals and options chain suggest a continuation of the bullish trend. The stock is trading above its 200-day MA by 31%, with RSI near overbought levels, indicating potential for a pullback but strong near-term momentum. Leveraged ETFs like Direxion Daily PLTR Bull 2X Shares (PLTU) and GraniteShares 2x Long PLTR Daily ETF (PTIR) offer amplified exposure, with PLTU up 7.5% today. For options, two contracts stand out:

• PLTR20251219C185 (Call, $185 strike, 12/19 expiry):
- IV: 47.64% (mid-range)
- Leverage ratio: 26.36% (high)
- Delta: 0.579 (moderate sensitivity)
- Theta: -0.7119 (rapid time decay)
- Gamma: 0.0265 (high sensitivity to price swings)
- Turnover: $4.56M (liquid)
- Payoff at 5% upside (196.86): $11.86/share. This call offers high leverage and liquidity, ideal for capitalizing on a continuation of the rally.

• PLTR20251219C190 (Call, $190 strike, 12/19 expiry):
- IV: 46.42% (mid-range)
- Leverage ratio: 41.13% (very high)
- Delta: 0.4427 (moderate sensitivity)
- Theta: -0.6112 (rapid time decay)
- Gamma: 0.0275 (high sensitivity)
- Turnover: $2.64M (liquid)
- Payoff at 5% upside (196.86): $6.86/share. This contract balances high leverage with manageable delta, making it a top pick for aggressive bulls.

Action: Aggressive bulls may consider PLTR20251219C185 into a break above $190.62 (Bollinger upper band). For a safer play, PLTU offers 2X exposure to the stock’s momentum.

Backtest Palantir Stock Performance
The backtest of Palantir's (PLTR) performance following a 3% intraday surge from 2022 to the present indicates favorable short-to-medium-term gains. The 3-day win rate is 61.11%, the 10-day win rate is 70.14%, and the 30-day win rate is 79.86%, suggesting that the stock tends to perform well in the immediate aftermath of such events. The maximum return observed was 24.06% over 30 days, indicating that there is potential for significant price appreciation following the 3% surge.

Palantir's Bull Run Gains Steam: Key Levels to Watch
Palantir’s 3.1% surge is a blend of fundamental catalysts and technical momentum, with the $448M Navy contract acting as a springboard for further gains. The stock’s proximity to its 52W high of $207.52 and the 200-day MA at $142.93 suggest a strong short-term bias to the upside. However, traders should monitor the 187.75 intraday high for a potential pullback. Meanwhile, sector leader Microsoft (MSFT) is down 2.29%, which could weigh on broader tech sentiment. Investors should hold long positions in PLTR or leveraged ETFs like PLTU if the stock holds above 181.01 (30D support). A breakdown below 177.88 (200D support) would signal a shift in sentiment. Watch for a test of $190.62 (Bollinger upper band) or a breakdown below $181.01.