UAMY Plummets 8.57%: What's Fueling the Selloff in Antimony?

Summary
• United States Antimony (UAMY) slumps to $7.835, down 8.58% from its intraday high of $8.84
• Options chain shows 884 contracts traded for the $8.5 strike call, with 41,690 shares exchanged
• RSI at 75.8 signals overbought conditions, while MACD histogram surges to 0.367
Today’s dramatic selloff in UAMY has sent the stock into a freefall, erasing nearly 8.6% of its value in a single session. The sharp decline comes amid a backdrop of elevated implied volatility in options and a technical setup that suggests short-term bearish momentum. With the stock trading near its 52-week low of $1.21, investors are scrambling to decipher whether this is a buying opportunity or a deeper structural issue.

Options Volatility and Short-Selling Pressure Drive Sharp Decline
The 8.58% intraday drop in UAMY is primarily attributed to aggressive short-selling pressure and elevated options volatility. The options chain reveals heavy trading in the $8.5 strike call option (UAMY20260123C8.5) with 884 contracts traded and 41,690 shares exchanged, indicating institutional bearish positioning. Implied volatility for this contract has spiked to 154.8%, while leverage ratios exceed 16%. The stock’s price action also aligns with a breakdown below key moving averages (30D: $6.005, 200D: $5.019), suggesting technical support levels have been breached. Despite a short-term bullish candlestick pattern, the RSI at 75.8 and MACD divergence confirm overbought exhaustion.

Metals & Mining Sector Diverges as BHP Gains 2.55%
While UAMY’s selloff is pronounced, the broader Metals & Mining sector shows resilience. Sector leader BHP Group (BHP) is up 2.55% intraday, reflecting divergent market sentiment. This disconnect highlights UAMY’s unique challenges—likely tied to its narrow antimony specialization versus BHP’s diversified mining portfolio. The sector’s 2.5% gain contrasts sharply with UAMY’s 8.6% drop, underscoring the stock’s vulnerability to commodity-specific risks and speculative trading dynamics.

Bearish Options and ETF Positioning in a Volatile Setup
• 200-day average: $5.019 (below current price)
• RSI: 75.79 (overbought)
• MACD: 0.4035 (bullish), Signal Line: 0.0363 (bearish divergence)
• Bollinger Bands: Price at 8.40 (upper) vs. 3.67 (lower)

Technical indicators present a mixed picture. The RSI’s overbought reading and MACD divergence suggest short-term exhaustion, while the stock remains above its 30D ($6.005) and 100D ($7.057) averages. Key support levels at $5.02 (200D MA) and $3.19 (long-term support) could trigger further declines if breached. The sector’s strength in BHP offers a counterpoint, but UAMY’s volatility profile demands caution.

Top Options Picks:
• UAMY20260123P7.5 (Put):
- Strike: $7.5, Expiry: 2026-01-23
- IV: 118.11% (high volatility)
- LVR: 17.52% (high leverage)
- Delta: -0.3621 (moderate sensitivity)
- Theta: -0.014958 (moderate time decay)
- Gamma: 0.2319 (high sensitivity to price moves)
- Turnover: 1,582 (liquid)
- Why: This put option offers a balance of leverage and liquidity, ideal for capitalizing on a 5% downside scenario (projected price: $7.44). The high gamma ensures responsiveness to price swings.

• UAMY20260123C8.5 (Call):
- Strike: $8.5, Expiry: 2026-01-23
- IV: 154.80% (extreme volatility)
- LVR: 16.43% (high leverage)
- Delta: 0.4442 (moderate sensitivity)
- Theta: -0.049080 (high time decay)
- Gamma: 0.1864 (moderate sensitivity)
- Turnover: 41,690 (extremely liquid)
- Why: Despite the bearish move, this call remains viable for aggressive bulls betting on a rebound above $8.5. The high turnover ensures easy entry/exit, and the 16.43% leverage amplifies potential gains if the stock stabilizes.

Payoff Estimation:
- Put Payoff: max(0, $7.44 - $7.5) = $0 (break-even at $7.5)
- Call Payoff: max(0, $7.44 - $8.5) = $0 (out-of-the-money)

Trading Hook: Aggressive bears should target UAMY20260123P7.5 into a breakdown below $7.5, while bulls may consider UAMY20260123C8.5 for a short-term bounce above $8.5.

Backtest United States Antimony Stock Performance
The backtest of UAMY's performance after a -9% intraday plunge from 2022 to now shows favorable results. The 3-Day win rate is 48.64%, the 10-Day win rate is 49.61%, and the 30-Day win rate is 52.33%, indicating a higher probability of positive returns in the short term. The maximum return during the backtest was 26.07% over 30 days, suggesting that UAMY has the potential for recovery and even exceed pre-plunge levels.

UAMY at Critical Juncture: Watch $5.02 Support and BHP’s Lead
The selloff in UAMY has created a high-risk, high-reward environment. While technical indicators suggest overbought exhaustion, the stock’s proximity to its 52-week low and elevated options volatility point to potential for further downside. Investors should closely monitor the $5.02 (200D MA) support level and the sector leader BHP’s 2.55% gain for directional clues. A breakdown below $5.02 could trigger a cascade to the 3.19–3.50 support zone, while a rebound above $8.5 might rekindle short-term bullish momentum. Position sizing and stop-loss placement are critical in this volatile setup.