Palantir’s (NASDAQ: PLTR) sustained bullish run may be under threat as short interest surges, potentially derailing its push toward a record high of $160.
As of press time, PLTR stock was trading at $154, up 0.20%, having gained over 3% in the past week.
Despite this upward momentum, data indicates a notable spike in Palantir’s short volume ratios, a key gauge of market sentiment.
On July 17, the company recorded a short volume of 19.42 million out of 32.03 million total shares traded, translating to a high short volume ratio of 60.64%.
A similar pattern appeared on July 16 and July 15, with ratios of 57.27% and 56.31%, respectively. These elevated levels suggest a growing number of traders are betting against the stock.
The increased short-selling activity could imply that investors are anticipating a pullback, possibly due to perceived overvaluation or a slowdown in momentum.
On July 14, short volume peaked at 20.76 million shares, its highest in a 10-day span, with a 50.33% ratio, reinforcing bearish sentiment.
Palantir stock risks
While Palantir has experienced strong buying interest and an upward price movement, the elevated short volume ratios reflect growing skepticism about the sustainability of its rally.
Still, the stock has managed to maintain its upward trajectory, defying bearish pressure, including long-standing concerns over overvaluation and ongoing insider selling, factors that would typically spook investors.
Notably, Palantir is currently riding a wave of AI-driven momentum, powered by rapid adoption of its Artificial Intelligence Platform (AIP) and a 71% year-over-year increase in U.S. commercial revenue in Q1 2025. However, the company remains heavily reliant on government contracts, which accounted for 55% of revenue in 2024.
Customer concentration remains a red flag, with 45% of revenue derived from just 20 clients. While Palantir’s customer base expanded by 43% and it landed a record $803 million commercial deal, overall revenue climbed only 29% last year, far below its 410% stock surge.
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