Rocket Pharmaceuticals Surges 28.56% as FDA Clears Gene Therapy Trial Resumption – What’s Next for RCKT?

Summary
• Rocket Pharmaceuticals (RCKT) surges 28.56% intraday, trading at $3.7412 after the FDA lifts clinical hold on its Danon disease gene therapy trial.
• Intraday range spans $3.1408 to $4.10, with turnover hitting 57.59 million shares.
• The stock trades below its 52-week high of $22.01 but above its 52-week low of $2.19.

Rocket Pharmaceuticals’ shares are in a tailwind following the FDA’s decision to resume its pivotal RP-A501 trial for Danon disease. The stock’s explosive move reflects optimism over regulatory progress and the potential for a breakthrough in a rare genetic disorder. With a dynamic PE ratio of -1.55 and a 58.26% turnover rate, the market is recalibrating its expectations for the biotech’s pipeline.

FDA Clears Path for Danon Disease Gene Therapy Trial Resumption
The FDA’s decision to lift the clinical hold on Rocket’s RP-A501 trial for Danon disease catalyzed the stock’s 28.56% surge. The agency confirmed that Rocket addressed safety concerns, allowing the trial to resume with a recalibrated dose of 3.8 x 10¹³ GC/kg and an optimized immunomodulatory regimen. This regulatory green light signals confidence in Rocket’s ability to balance safety and efficacy, particularly after a patient death in May prompted the initial hold. The revised protocol, which discontinues prophylactic C3 complement inhibitors and maintains sirolimus, rituximab, and steroids, aligns with Phase 1 data showing improved biomarkers at lower doses. Investors are interpreting this as a critical step toward potential accelerated approval, given the trial’s co-primary endpoints of LAMP2 protein expression and left ventricular mass reduction.

Biotechnology Sector Volatility Amid Regulatory Hurdles
The biotechnology sector remains in a mixed state, with Amgen (AMGN) trading flat at +0.46% intraday. Rocket’s surge contrasts with broader sector caution, as recent news highlights regulatory scrutiny and clinical setbacks. For instance, PTC Therapeutics’ Friedreich’s ataxia drug was rejected by the FDA, while Regenxbio’s Hunter syndrome gene therapy faces a 3-month PDUFA delay. Rocket’s rally underscores the sector’s sensitivity to regulatory outcomes, particularly for rare disease therapies with high unmet need. However, the stock’s performance is largely decoupled from sector trends, driven by its unique position in the Danon disease market.

Options and Technicals: Navigating Rocket’s Volatility
• MACD: -0.0444 (Signal Line: -0.0484, Histogram: +0.0040) – Slight bullish divergence.
• RSI: 39.05 – Oversold territory, suggesting potential rebound.
• Bollinger Bands: Upper $3.28, Middle $3.05, Lower $2.82 – Price at $3.74 breaches upper band, indicating overbought conditions.
• 200D MA: $8.07 (far above current price), 100D MA: $4.42, 30D MA: $3.06 – Strong bearish trend.
• Support/Resistance: 30D: $3.05, 200D: $2.94–$3.25 – Current price above key resistance.

Rocket’s technicals suggest a short-term overbought condition, with RSI at 39.05 and MACD showing a minor bullish divergence. However, the stock remains below its 200-day average, indicating long-term bearish sentiment. The K-line pattern of a short-term bearish trend clashes with the intraday rally, creating a volatile setup. Traders should monitor the $3.05 support level and the $4.10 intraday high for potential reversal cues.

Top Options Picks:
• RCKT20260417C5 (Call Option):
- Strike Price: $5.00
- Expiration: April 17, 2026
- IV Ratio: 111.46% (extremely high volatility)
- Leverage Ratio: 3.74% (moderate)
- Delta: 0.565 (moderate sensitivity)
- Theta: -0.0030 (slow time decay)
- Gamma: 0.116 (high sensitivity to price changes)
- Turnover: 18,379 (high liquidity)
- Price Change Ratio: 11.11% (strong momentum)
- Payoff at 5% Upside: $0.385 (max(0, 3.93 - 5.00) = 0).
- Why It Stands Out: High IV and gamma make this call option responsive to price swings, ideal for a volatile biotech stock. The moderate delta balances risk and reward.
• RCKT20260417C5 is the only available contract, but its high IV and gamma position it as a speculative play for aggressive bulls betting on a sustained rally.

Trading Setup: Aggressive bulls may consider RCKT20260417C5 into a breakout above $4.10, while cautious investors should watch the $3.05 support level. The stock’s technicals suggest a short-term rebound but a long-term bearish bias.

Backtest Rocket Stock Performance
The backtest of RCKT's performance after a 29% intraday increase shows mixed results. While the stock experienced a significant surge, the subsequent 3-day, 10-day, and 30-day win rates were not as favorable, indicating potential downside risk following the initial gain.

Rocket’s FDA Win: A Catalyst or a Flash in the Pan?
Rocket Pharmaceuticals’ 28.56% surge is a direct response to the FDA’s decision to resume its Danon disease trial, a critical milestone for a company targeting a rare, high-unmet-need condition. While the stock’s technicals remain bearish, the regulatory progress and revised trial protocol could fuel further optimism. Investors should monitor the $3.05 support level and the $4.10 intraday high for directional clues. In the broader sector, Amgen’s flat performance highlights the biotech industry’s cautious stance, but Rocket’s unique position in the Danon disease market may justify its volatility. Action: Watch for a sustained close above $4.10 or a breakdown below $3.05 to confirm the next move.