Polestar A (PSNY) Surges 12.28% on $300M Equity Deal Amid Volatile Trading Session

Summary
• Polestar A (PSNY) surges 12.28% intraday to $14.36, breaking above its 52-week high of $42.60
• $300M equity deal with Banco Bilbao Vizcaya Argentaria and Natixis fuels liquidity optimism
• Technical indicators signal overbought conditions (RSI: 70.63) and bullish momentum (MACD: 3.34)

The stock’s explosive move reflects a mix of strategic financing news and technical catalysts. Polestar’s recent $300M equity infusion, coupled with a debt-to-equity conversion, has reignited speculative interest. However, the stock’s 60% annual decline and volatile 9.27% intraday range underscore its precarious position.

Equity Financing Ignites Short-Term Optimism
Polestar’s 12.28% intraday surge stems from its $300M equity deal with Banco Bilbao Vizcaya Argentaria and Natixis, which includes a $300M debt-to-equity conversion by Geely Sweden. This liquidity injection aims to stabilize operations amid persistent losses and weak demand. While the news alone cannot reverse Polestar’s 60% annual decline, it has temporarily boosted investor sentiment. The stock’s sharp rebound aligns with a bullish engulfing candlestick pattern and a 6.32% prior close gain, suggesting short-term traders are capitalizing on oversold conditions.

Automotive Sector Volatility Amid EV Sector Divergence
The broader automotive sector remains mixed, with Tesla (TSLA) rising 2.5% on renewed EV demand optimism. Polestar’s 12.28% move outpaces peers like Rivian (-1.8%) and Lucid (+4.36%), highlighting its speculative nature. While EV sector ETFs show resilience, Polestar’s liquidity-driven rally lacks fundamental support, contrasting with Tesla’s production growth narrative.

Options Playbook: Leveraging Volatility with PSNY20260116C14 and PSNY20260116C15
• 200-day MA: $1.56 (far below current price)
• RSI: 70.63 (overbought)
• MACD: 3.34 (bullish divergence)
• Bollinger Bands: $19.95 (upper), $6.44 (middle), -$7.07 (lower)

Key levels to watch: $14.49 (intraday high) and $12.895 (intraday low). The stock’s 14.37% projected daily range suggests high volatility. While the RSI indicates overbought conditions, the MACD and bullish engulfing pattern suggest continuation. No leveraged ETF data is available, but the options chain offers high-leverage opportunities.

Top Option 1: PSNY20260116C14
• Code: PSNY20260116C14
• Type: Call
• Strike Price: $14
• Expiration: 2026-01-16
• IV: 99.97% (high volatility)
• Leverage Ratio: 8.44%
• Delta: 0.5927 (moderate sensitivity)
• Theta: -0.0394 (significant time decay)
• Gamma: 0.1014 (high sensitivity to price changes)
• Turnover: 3,945

This call option offers a balance of leverage and liquidity. The high gamma ensures responsiveness to price swings, while the 99.97% IV reflects market anticipation of volatility. A 5% upside to $15.08 would yield a payoff of $1.08 per contract, translating to a 27.7% return on the $3.945 premium.

Top Option 2: PSNY20260116C15
• Code: PSNY20260116C15
• Type: Call
• Strike Price: $15
• Expiration: 2026-01-16
• IV: 98.93% (high volatility)
• Leverage Ratio: 11.47%
• Delta: 0.4892 (moderate sensitivity)
• Theta: -0.0383 (significant time decay)
• Gamma: 0.1053 (high sensitivity to price changes)
• Turnover: 370

This contract provides higher leverage (11.47%) and slightly lower delta, making it ideal for aggressive bulls. A 5% move to $15.08 would generate a $0.08 payoff, a 21.6% return on the $0.370 premium. Both options benefit from the stock’s overbought RSI and bullish MACD, but require strict risk management due to the stock’s 60% annual decline.

Backtest Polestar A Stock Performance
The backtest of PSNY's performance after a 12% intraday surge from 2022 to now shows mixed results. While the 3-day win rate is high at 47.26%, the 10-day and 30-day win rates are lower at 40.21% and 34.20%, respectively. The maximum return during the backtest period was only 0.06%, indicating that the stock struggled to capitalize on the intraday surge over longer time frames.

Act Now: Ride the Volatility or Exit Before the Drop
Polestar’s 12.28% surge is a short-term liquidity-driven rally, not a sustainable turnaround. The stock’s 60% annual decline and -52.79% 3-month forecast from technical models suggest caution. Aggressive bulls may chase the PSNY20260116C14 or C15 calls, but must monitor the $14.49 intraday high for a potential breakdown. Tesla (TSLA)’s 2.5% rise underscores the sector’s divergence, but Polestar’s fundamentals remain fragile. Watch for a close below $12.55 support or a break above $14.49 to validate the move.