Velo3D Soars 31.7% on Aerospace Breakthrough – What’s Fueling This Volatile Surge?

Summary
• Velo3D (VELO) surges 31.7% intraday to $8.68, breaking its 52-week high of $8.95
• Mears Machine’s aerospace delivery using Velo3D’s Sapphire XC system sparks post-hours frenzy
• Q3 revenue beats estimates at $13.6M, but EBITDA remains negative at -$7.3M
• Technicals show RSI at 70.53 (overbought), MACD above signal line, and a short-term bullish Kline pattern

Velo3D’s explosive move has ignited speculation about its role in the additive manufacturing (AM) boom. The stock’s 31.7% intraday gain follows a pivotal aerospace delivery by Mears Machine, a strategic U.S. Navy contract, and a bullish technical setup. With the stock trading near its 52-week high and a 39.9% monthly gain, investors are scrambling to decipher whether this is a short-term rally or a catalyst for sustained growth.

Aerospace Milestone Ignites Additive Manufacturing Optimism
Velo3D’s meteoric rise stems from Mears Machine Corporation’s delivery of a complete aerospace gas turbine hardware set using Velo3D’s Sapphire XC system. This marks the first production of large-format, weld-free components for high-speed rotating applications, a breakthrough in additive manufacturing for defense and aerospace. The partnership with Mears, combined with a $6M Navy contract for CuNi alloy qualification and SpaceX’s adoption of Velo3D parts in Raptor engines, has validated the company’s technology as critical for next-gen defense and space infrastructure. CEO Arun Jeldi’s confirmation of expanded collaboration with Anduril and SpaceX’s potential machine orders further stoked demand.

Aerospace & Defense Sector Gears Up for Additive Manufacturing Disruption
The aerospace and defense sector is witnessing a paradigm shift as additive manufacturing replaces traditional casting and machining. Velo3D’s recent milestones align with broader industry trends, including the U.S. Army’s plan to purchase one million drones and SpaceX’s 560th Falcon 9 launch. While peers like Lockheed Martin (LMT) and Boeing (BA) focus on legacy systems, Velo3D’s RPS model and partnerships with cutting-edge firms like Anduril and SpaceX position it as a first-mover in AM-driven defense innovation. The sector’s 30-day average price trend remains positive, but Velo3D’s 39.9% monthly gain far outpaces its peers.

Options Playbook: Leveraging Velo3D’s Volatility with Precision
• Technical Indicators:
- RSI: 70.53 (overbought)
- MACD: 0.305 (bullish divergence)
- 30D MA: $5.16 (well below current price)
- Bollinger Bands: Price at 8.68 vs. upper band 6.60 (oversold)

Velo3D’s technicals suggest a continuation of its bullish momentum, with key resistance at $8.95 (52-week high) and support at $6.90 (intraday low). The stock’s 38.2% turnover rate and 31.7% intraday gain indicate strong short-term demand. For options traders, the VELO20260116P7.5 put option stands out: it offers a 1756% leverage ratio and 24.68% implied volatility, with a delta of -0.019 (near at-the-money). A 5% upside scenario (targeting $9.11) would yield a put payoff of $1.61 per contract. This option’s high gamma (0.0665) and moderate theta (-0.0002) make it ideal for capitalizing on volatility without excessive time decay. Aggressive bulls should monitor a breakout above $8.95, while cautious traders may hedge with the put to protect against a pullback to $6.90.

Backtest Velo3D Stock Performance
The backtest of VELO's performance following a 32% intraday surge from 2022 to now shows favorable results. The 3-Day win rate is 58.33%, the 10-Day win rate is 63.89%, and the 30-Day win rate is 86.11%, indicating a high probability of positive returns in the short term. The maximum return during the backtest was 44.81% over 30 days, suggesting that VELO can deliver significant gains even after such a substantial initial increase.

Velo3D at Inflection Point: Ride the Wave or Secure a Safety Net?
Velo3D’s 31.7% intraday surge is a testament to its growing influence in additive manufacturing for defense and aerospace. With the stock trading near its 52-week high and a 39.9% monthly gain, the momentum appears to be fueled by strategic partnerships and sector tailwinds. However, the RSI at 70.53 signals overbought conditions, and the MACD histogram’s 0.152 suggests a potential pullback. Investors should watch for a breakout above $8.95 to confirm a new bullish phase or a retest of $6.90 as a key support. Meanwhile, the sector leader Lockheed Martin (LMT) fell 0.3% today, highlighting the need for caution. For those seeking leverage, the VELO20260116P7.5 put offers a high-leverage hedge. In this high-conviction trade, timing is everything—position now or risk missing the next phase of this additive manufacturing revolution.