Monday morning trading saw Velo3D Inc. ( VELO ) defying a broader market dip, with shares of the additive manufacturing firm surging despite sluggishness in major indices amid Middle East conflict.

Short Interest Hits 20.8% Float

According to Benzinga’s short interest report, bearish bets against Velo3D ( VELO ) rose from 2.51 million to 2.55 million shares during the last reporting period.

This increase brings the total short interest to 20.8% of the company’s publicly available shares. With an average daily volume of 2.20 million shares, it would take 1.16 day(s) for holders of this short interest to close out their positions without sending the stock sharply higher.

Defense Momentum Fuels Gains

The upward trajectory follows a heavy streak of defense sector wins. The company recently secured an $11.5 million multi-year full-rate production contract with a major U.S. defense contractor. This deal utilizes laser powder bed fusion printers to deliver components at lower costs than traditional manufacturing.

Strategic Army Qualification

Contextualizing the rally, Velo3D ( VELO ) was recently named the first qualified 3D-printing vendor by the U.S. Army Ground Vehicle Systems Center. This qualification allows the company to produce critical aluminum and Inconel 718 components for ground combat vehicles.

Technical Analysis

VELO is trading 1.7% above its 20-day SMA, and 17.4% above its 100-day SMA, which suggests the longer-term uptrend is still intact even after a choppy pullback.

Shares are up 247.62% over the past 12 months, and the stock is currently positioned closer to its 52-week highs than lows. The RSI is at 43.33, which sits in neutral territory and points to momentum that isn’t stretched after the recent swings.

Key Resistance: $11.50

Key Support: $11.50

VELO Price Action: Velo3D ( VELO ) shares were up 15.42% at $11.75 at the time of publication on Monday, according to Benzinga Pro data.