USAR Surges 19.58%: What's Fueling the Rare Earth Rally?

Summary
• USA Rare Earth (USAR) rockets 19.58% to $14.23, piercing its 52-week high of $43.98
• Sector leader MP Materials (MP) gains 8.8%, signaling rare earth momentum
• Options frenzy: 2026-01-09 call options at 14.5/15 strike prices see 525–640% price change ratios

Today’s explosive move in USAR defies its long-term ranging pattern, with intraday volatility squeezing the stock between $12.17 and $14.41. The rare earth sector’s synchronized rally—driven by MP’s 8.8% surge—suggests thematic tailwinds. Technical indicators and options data now scream a critical inflection point.

Oversold Rebound and Bollinger Band Breakout Drive USAR Surge
USAR’s 19.58% intraday jump stems from a textbook oversold rebound. The RSI at 28.37 (oversold territory) and MACD histogram (-0.21) signaled exhausted bearish momentum. Price pierced the lower Bollinger Band ($10.95) and snapped back violently, with the 200-day MA ($14.43) acting as a dynamic support. High implied volatility (IV) in call options (84.23–101.01%) confirms speculative positioning for a continuation.

Rare Earth Sector Gains Momentum as MP Leads with 8.8% Surge
While USAR’s 19.58% surge dwarfs MP’s 8.8% gain, both stocks reflect rare earth sector strength. MP’s rally stems from its dominance in U.S. rare earth processing, but USAR’s speculative options activity (e.g., 14.5/15 call options with 525–640% price change ratios) suggests retail-driven momentum. The sector’s 52-week low of $5.56 versus USAR’s $14.23 highlights divergent investor sentiment.

High-Leverage Call Options and ETF Neutral: Capitalizing on USAR’s Breakout
• 200-day MA: $14.43 (near current price); RSI: 28.37 (oversold); Bollinger Bands: $10.95–$19.01
• Key levels: 200D MA ($14.43) as immediate resistance; 30D support ($13.41–$13.55) as critical floor

Two top options stand out for aggressive bulls: USAR20260109C14 and USAR20260109C15.5.

USAR20260109C14
• Code: USAR20260109C14
• Type: Call
• Strike: $14
• Expiry: 2026-01-09
• IV: 84.23% (high volatility)
• Leverage: 15.94% (high)
• Delta: 0.605 (moderate sensitivity)
• Theta: -0.0837 (rapid time decay)
• Gamma: 0.215 (high sensitivity to price swings)
• Turnover: $50,677 (liquid)

This contract thrives on USAR’s 19.58% surge, with a 5% upside (to $14.94) yielding a payoff of $0.94 per contract. High gamma ensures rapid premium gains if the stock breaks $14.43.

USAR20260109C15.5
• Code: USAR20260109C15.5
• Type: Call
• Strike: $15.5
• Expiry: 2026-01-09
• IV: 95.42% (very high)
• Leverage: 38.78% (extreme)
• Delta: 0.3195 (moderate sensitivity)
• Theta: -0.0672 (rapid decay)
• Gamma: 0.1763 (high sensitivity)
• Turnover: $35,119 (liquid)

With 38.78% leverage, this contract amplifies USAR’s breakout. A 5% upside (to $14.94) yields a $0.44 payoff. High IV and gamma make it ideal for a short-term parabolic move.

Aggressive bulls should target USAR20260109C14 into a break above $14.43. If USAR retests $13.41, USAR20260109C15.5 offers high-reward potential.

Backtest USA Rare Earth Stock Performance
The backtest of the USAR ETF after a 20% intraday surge from 2022 to the present shows favorable performance metrics. The 3-day win rate is 54.02%, the 10-day win rate is 51.72%, and the 30-day win rate is 71.26%, indicating a higher probability of positive returns in the short term. The maximum return during the backtest was 34.83%, which occurred on day 59, suggesting that there is potential for significant gains even in a relatively short period.

Bullish Setup Confirmed: USAR Eyes $14.41 Intraday High
USAR’s 19.58% surge confirms a short-term bullish reversal, with RSI at 28.37 and Bollinger Band breakout acting as catalysts. The 200-day MA ($14.43) and 52-week high ($43.98) remain distant, but options data (e.g., 14.5/15.5 call IV at 84.23–95.42%) suggest speculative positioning for a continuation. Sector leader MP’s 8.8% gain reinforces thematic momentum. Investors should monitor the $14.43 resistance and watch for a break above $14.41 intraday high. Aggressive bulls may consider USAR20260109C14 into a confirmed breakout.