USAR Surges 12.4% on Intraday Rally: What's Fueling the Momentum?

Summary
• USA Rare Earth (USAR) surges 12.4% to $15.91, breaking above its 52-week low of $5.56
• RSI at 29.75 signals oversold conditions, while Bollinger Bands show price near lower boundary
• Sector leader MP Materials (MP) gains 6.35%, hinting at metals sector tailwinds

Today’s explosive move in USAR has ignited market speculation, with the stock trading at its highest level since January 2026. The surge follows a technical rebound from multi-year lows and coincides with elevated volatility in the metals sector. With options volume surging and implied volatility spiking to 171%, traders are scrambling to position for the next phase of this rare earths play.

Technical Rebound and Volatility Catalysts Drive USAR
The 12.4% intraday surge in USAR is primarily driven by a technical rebound from its 52-week low of $5.56 and a sharp increase in implied volatility. The stock has been trading in a long-term range between $5.56 and $43.98, with today’s move breaking above key resistance levels. The RSI at 29.75 indicates oversold conditions, while the MACD histogram (-0.075) suggests a narrowing bearish divergence. Options data reveals a 171% implied volatility spike for the $10.5 strike, reflecting aggressive short-term positioning. No company-specific news was released, making this a purely technical and volatility-driven move.

Metals Sector Gains Momentum as MP Materials Leads Charge
The broader metals sector is showing renewed strength, with MP Materials (MP) surging 6.35% on the same day. While USAR’s move is more pronounced, the sector-wide tailwinds suggest thematic support for rare earth and critical minerals plays. MP’s performance indicates institutional capital is rotating into the sector, potentially spilling over into smaller-cap names like USAR. However, USAR’s 12.4% move outpaces MP’s 6.35%, suggesting independent technical momentum rather than pure sector contagion.

High-Volatility Options and ETF Positioning for USAR’s Breakout
• 200-day average: $14.42 (below current price)
• RSI: 29.75 (oversold)
• MACD: -0.904 (bearish but narrowing)
• Bollinger Bands: $10.96 (lower) to $19.01 (upper)

USAR’s technical profile suggests a short-term reversal from oversold conditions. Key levels to watch include the 200-day MA at $14.42 and the upper Bollinger Band at $19.01. The stock’s 12.4% move has created a high-velocity environment, with options data showing aggressive positioning in out-of-the-money calls. Two top options for consideration:

• USAR20260109C15
- Type: Call
- Strike: $15.00
- Expiration: 2026-01-09
- IV: 113.07% (high volatility)
- Leverage Ratio: 12.18% (high gearing)
- Delta: 0.683 (moderate sensitivity)
- Theta: -0.154 (rapid time decay)
- Gamma: 0.1699 (high sensitivity to price moves)
- Turnover: 147,914 (liquid)
- Payoff (5% up): $0.795 (max(0, 16.70 - 15.00))
- Why: High leverage and gamma make this ideal for a continuation of the rally.

• USAR20260109C16
- Type: Call
- Strike: $16.00
- Expiration: 2026-01-09
- IV: 112.88% (high volatility)
- Leverage Ratio: 20.83% (extreme gearing)
- Delta: 0.496 (moderate sensitivity)
- Theta: -0.143 (rapid time decay)
- Gamma: 0.1907 (very high sensitivity)
- Turnover: 78,389 (liquid)
- Payoff (5% up): $0.835 (max(0, 16.70 - 16.00))
- Why: Extreme leverage and gamma position this as a high-reward/high-risk play for aggressive bulls.

Aggressive bulls may consider USAR20260109C16 into a break above $16.139, the intraday high. If the $19.01 upper Bollinger Band is tested, the USAR20260109C15 call could offer a safer entry with moderate leverage.

Backtest USA Rare Earth Stock Performance
The backtest of the USAR ETF after a 12% intraday increase from 2022 to the present reveals positive short-to-medium-term performance. 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 immediate term. The maximum return during the backtest was 34.83% over 30 days, suggesting that while there is volatility, significant gains are possible with a 12% intraday surge.

Act Now: USAR’s Breakout Demands Immediate Positioning
USAR’s 12.4% surge signals a potential short-term reversal from multi-year lows, supported by oversold RSI and narrowing MACD divergence. The key to sustainability lies in holding above the $14.42 200-day MA and testing the $19.01 upper Bollinger Band. Sector leader MP’s 6.35% gain reinforces thematic momentum in critical minerals. Traders should prioritize the USAR20260109C16 call for aggressive upside potential or the USAR20260109C15 for a more balanced approach. Watch for a breakdown below $14.34 intraday low or a sustained move above $16.139 to confirm the trend.