USAR is squeezing short sellers and options traders are responding accordingly
USA Rare Earth Inc ( NASDAQ:USAR) stock is 13.4% higher to trade at $22.61, after the critical minerals company acquired Brazil's Serra Verde for $2.8 billion. The deal is expected to close in the third quarter of 2026, and positions the company to better challenge China's rare earth market dominance. U.S.-based sector peer MP Materials (MP) is getting a halo lift on the news, up 4.9% this morning.
USAR is now up 92.9% in 2026 and is trading at its highest level since Feb. 10. The $14 level proved to be a floor during the March pullback, while the shares' 320-day moving average also stepped up as support. Keep an eye on the stock's 14-Day Relative Strength Index (RSI), though, last seen drifting into "overbought" territory at 69.
A short squeeze could power additional gains. Short interest is up 14.6% in the most recent reporting period, and the 26.86 million shares sold short account for 14.5% of USAR's total available float.
Options traders are out in droves today. In just the first half hour of trading, over 56,000 calls have changed hands, volume that's nine times the average intraday amount and six times the number of puts traded. The May 26 call is the most popular, while new positions are being bought to open at the weekly 4/24 25-strike call.