Reddit (RDDT) Surges 6.19% on Intraday Rally: What’s Fueling the Momentum?

Summary
• Reddit (RDDT) trades at $236.54, up 6.19% from its previous close of $222.75
• Intraday high hits $237.41, nearing 52-week high of $282.95
• Options volume spikes on 12/12 expirations, with 3,423,585 shares traded
• Sector peers like Meta (META) lag with 1.84% intraday gain

Reddit’s explosive move has ignited speculation about catalysts, from sector-wide optimism to speculative options activity. With the stock piercing key resistance levels and the Interactive Media sector trading at a 30.1x P/E (above its 3-year average), the rally demands scrutiny. Traders are now parsing technicals and options data to gauge sustainability.

Bullish Technicals and Sector Optimism Drive RDDT’s Surge
Reddit’s 6.19% intraday gain is fueled by a confluence of technical and sector-level factors. The stock’s RSI of 69.08 suggests overbought conditions, while the MACD histogram of 4.08 indicates strong bullish momentum. The 52-week high of $282.95 remains a distant target, but the 200-day moving average at $166.05 provides a robust support backdrop. Meanwhile, the Interactive Media sector’s 30.1x P/E—14% above its 3-year average—reflects investor confidence in long-term growth, with earnings growth of 26% annually over the past three years. This sector-wide optimism has spilled into RDDT’s price action.

Interactive Media Sector Gains Momentum as Reddit Surpasses META’s Rally
The Interactive Media sector’s $5.7 trillion market cap and 30.1x P/E ratio underscore its premium valuation. While Meta (META) trails with a 1.84% intraday gain, Reddit’s 6.19% surge outpaces sector peers. The sector’s 11% annual revenue growth and 26% earnings growth highlight its appeal, but RDDT’s technicals—particularly its 69.08 RSI and 4.66 MACD—suggest it is outperforming broader industry trends. This divergence points to speculative buying rather than fundamental sector rotation.

High-Leverage Calls and Gamma-Driven Plays for RDDT’s Rally
• 200-day average: $166.05 (far below current price)
• RSI: 69.08 (overbought but not extreme)
• MACD: 4.66 (bullish momentum)
• Bollinger Bands: Upper at $231.67, Middle at $201.49

Reddit’s technicals suggest a continuation of its bullish trend, with key resistance at $237.41 (intraday high) and $240 (call-heavy strike). The RDDT20251212C235 and RDDT20251212C240 options stand out for their high leverage and liquidity.

RDDT20251212C235
• Code: RDDT20251212C235
• Type: Call
• Strike: $235
• Expiration: 2025-12-12
• IV: 66.05% (high)
• LVR: 22.80% (high)
• Delta: 0.559 (moderate)
• Theta: -1.199 (high decay)
• Gamma: 0.017 (high sensitivity)
• Turnover: 857,441

This contract offers aggressive leverage for a 5% upside scenario (targeting $248.37). Its high gamma ensures rapid premium gains if the stock breaks $235, while high IV reflects market anticipation of volatility.

RDDT20251212C240
• Code: RDDT20251212C240
• Type: Call
• Strike: $240
• Expiration: 2025-12-12
• IV: 64.87% (high)
• LVR: 30.20% (very high)
• Delta: 0.472 (moderate)
• Theta: -1.101 (high decay)
• Gamma: 0.017 (high sensitivity)
• Turnover: 949,923

With a 30.20% leverage ratio, this option amplifies returns if RDDT closes above $240. Its high turnover ensures liquidity, and the 64.87% IV suggests market consensus on near-term volatility.

Action: Aggressive bulls should target RDDT20251212C240 for a breakout above $240, while RDDT20251212C235 offers a safer entry if the stock consolidates near $235.

Backtest Reddit Stock Performance
It looks like my attempt to retrieve the price series for the ticker “RDDT” produced an error—very likely because the ticker does not have data stretching back to 2022 (Reddit’s IPO only occurred in 2024).Could you please confirm one of the following so we can proceed correctly?1. Is “RDDT” definitely the intended ticker? • If so, would you like me to restrict the analysis to the period starting from the IPO date (March 2024) up to today?2. If you were referring to a different symbol (or an ETF/ADR that has existed since 2022), please let me know the correct ticker.Once I have the right ticker and date range, I’ll automatically detect every trading day where the intraday move exceeded 6 % and run the event-based back-test.

Reddit’s Rally: A Short-Term Bet on Sector Optimism and Technical Momentum
Reddit’s 6.19% surge is a blend of sector optimism and technical momentum, with the Interactive Media sector’s 30.1x P/E and 26% earnings growth providing a tailwind. Traders should monitor the $237.41 intraday high and $240 strike level for continuation signals. While Meta (META) lags with a 1.84% gain, RDDT’s options activity—particularly the RDDT20251212C240—suggests speculative positioning for a near-term breakout. Act now: Buy RDDT20251212C240 if $237.41 is cleared, or short-term traders can target $240 as a key resistance.