Rocket Companies Soars 7.1% on Trump's Mortgage Bond Plan: Is This the Catalyst for a Sustained Rally?

Summary
• Rocket Companies (RKT) surges 7.13% intraday to $22.755, hitting its 52-week high of $23.415
• Trump’s $200B mortgage bond purchase plan sparks optimism for lower rates and higher loan demand
• Options volume triples average, with 80,000 calls traded, led by the 1/9 22-strike call

Rocket Companies’ stock is experiencing a historic intraday rally driven by President Trump’s bold mortgage market intervention. With the stock trading near its 52-week peak and options activity surging, the market is pricing in a sharp shift in housing affordability dynamics. This move aligns with broader sector optimism as Trump’s plan to leverage Fannie Mae and Freddie Mac’s cash reserves gains traction.

Trump's Mortgage Bond Plan Ignites Rocket's Surge
President Trump’s announcement to direct Fannie Mae and Freddie Mac to purchase $200 billion in mortgage bonds has catalyzed Rocket Companies’ rally. By reducing mortgage rates and monthly payments, the plan aims to boost homeownership affordability, directly benefiting Rocket’s mortgage origination and refinancing volumes. The market’s immediate reaction—Rocket’s stock hitting a four-year high—reflects heightened expectations for increased loan demand. Options traders are amplifying this optimism, with call options outpacing puts by a 6:1 ratio, signaling strong conviction in the stock’s near-term trajectory.

Mortgage Finance Sector Rally: LendingTree Leads with 13.7% Surge
The Mortgage Finance sector is rallying in lockstep with Rocket’s surge, led by LendingTree (TREE), which has jumped 13.74% on the same policy tailwinds. Both stocks are beneficiaries of Trump’s rate-cutting strategy, which aims to stimulate housing activity. Rocket’s 7.13% gain, while significant, trails LendingTree’s sharper move, suggesting divergent market perceptions of execution risk and growth potential within the sector.

Options Playbook: High-Leverage Calls and Volatility-Driven Bets
• RSI: 80.68 (overbought)
• MACD: 0.687 (bullish), Signal Line: 0.495
• Bollinger Bands: Price at 21.52 (upper), 19.51 (middle), 17.51 (lower)
• 200D MA: 16.17 (well above)

Rocket’s technicals scream short-term bullish momentum. The stock is trading near its 52-week high, with RSI in overbought territory and MACD above the signal line. The 200-day moving average is a distant 16.17, suggesting a strong breakout. For aggressive traders, the RKT20260116C22.5 call option (strike: $22.5, expiration: 1/16) offers a 25.01% leverage ratio and 0.2015 gamma, ideal for capitalizing on continued upside. A 5% price move to $23.89 would yield a $1.39 payoff. For hedging, the RKT20260116P22 put (strike: $22, IV: 60.11%) provides downside protection with a 48.41% leverage ratio. Both contracts benefit from elevated implied volatility (50–60%) and high turnover, ensuring liquidity. Aggressive bulls should target a $23.50 pivot; a close above this could trigger a 200-day MA crossover and extend the rally.

Backtest Rocket Companies Stock Performance
The backtest of Rocket Lab USA (RKT) following a 7% intraday increase from 2022 to the present shows favorable short-to-medium-term performance. The 3-Day win rate is 49.90%, the 10-Day win rate is 52.34%, and the 30-Day win rate is 56.21%, indicating a higher probability of positive returns in the immediate aftermath of the surge. The maximum return during the backtest was 4.88%, which occurred on day 57 after the surge, suggesting that while there is potential for gains, the returns may not always be at the highest level immediately following the intraday increase.

Act Now: Rocket's Bullish Momentum and Sector Synergy Signal High-Probability Trade
Rocket Companies’ rally is underpinned by a policy-driven catalyst with clear sector alignment. The stock’s technicals and options activity suggest a high-probability continuation of the bullish trend, particularly if Trump’s mortgage bond purchases gain regulatory momentum. LendingTree’s 13.74% surge underscores the sector’s receptiveness to affordability-focused policies. Traders should monitor the $23.50 level as a critical breakout threshold and consider the RKT20260116C22.5 call for leveraged exposure. With the sector primed for a sustained rally, now is the time to position for a potential multi-week upcycle.