Bloom Energy’s stock jumped by 18.5% after announcing a $2.65 billion deal with American Electric Power (AEP). This deal includes the option to build a 900 MW solid oxide fuel cell facility in Wyoming. In November 2025, AEP had already completed a 100 MW deal with Bloom Energy and had the option for an extra 900 MW. AEP secured a 20-year power offtake agreement with a high-quality unnamed customer.

Market Performance and Economic Indicators

The Dow Jones Industrial Average rose by 0.4%, while the NASDAQ fell by 0.5% in a volatile market. In the US, Continuing Jobless Claims have exceeded 1.9 million, and Initial Jobless Claims came in slightly lower than expected at 208,000. Bloom Energy’s technology is gaining popularity among AI data centers as it provides power without combustion, using natural gas and steam. The recent deal with AEP has boosted Bloom Energy’s stock, which increased by 291% in 2025 and 37% this year. Even with the market excitement, some investors are taking profits as Bloom’s shares are trading over 100 times the expected earnings per share (EPS) for 2026, which is $1.08. Shares reached a high above $128 before settling around $119, which is a level where the stock has faced resistance in the past and suggests potential for future gains.

Traders’ Strategies and Market Trends

With AEP’s big deal supporting the narrative around AI data centers, traders may see any weakness in stock prices as a buying opportunity. There’s been a notable rise in call option activity for February expirations, especially at the $130 and $140 strike prices, indicating bets that the stock will keep rising. This optimism is backed by reports from the International Energy Agency predicting a 30% annual increase in power demand from AI through 2030. However, the stock’s inability to stay above the intraday high of $128 shows that some traders are cashing out. The implied volatility for Bloom Energy options has surged to over 85%, increasing the cost of buying calls and puts. This high volatility suggests that the market expects significant price fluctuations in the coming month. The stock’s high valuation is a point of concern, trading at over 100 times its future earnings. In comparison, the iShares Global Clean Energy ETF (ICLN) has an average forward P/E of about 28. This premium valuation may lead some traders to consider selling call spreads above the $147 resistance level, betting the stock won’t rise further soon. We’re closely monitoring the $120 price level, which is a key resistance point from October and December 2025. A weekly close above $120 would signal strong bullish momentum that could push the stock higher. The put-to-call ratio has dipped to 0.45, its lowest level since last autumn’s rally, indicating that bullish sentiment is currently strong. If Bloom Energy fails to maintain the $120 support level, a drop toward the pre-announcement price of $108 is likely. The impressive 291% rally in 2025 shows how quickly this stock can move based on momentum. Therefore, implementing risk-managed strategies such as credit or debit spreads may be wise to handle the expected volatility. Create your live VT Markets account and start trading now.

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