Ondas Inc (ONDS) is having a good Tuesday. The defense technology company announced a $6.9 million order from the Australian Department of Defence on Monday, and investors are cheering. The stock was up nearly 10% at $7.54 in afternoon trading.

The contract is for DTIM Single Operator Counter-sUAS Kits — basically, high-tech drone-fighting gear. These kits can detect drones up to 25 kilometers away, track them with Remote ID, identify threats using AI, and take them down with the Dronebuster DB4 effector. The order was secured through distributor HIFraser, and the work will be managed under Ondas's Sentinel defense division.

Eric Brock, Chairman and CEO of Ondas, framed the deal as a big validation. "Australia's investment in Ondas' DTIM Kits underscores the increasing global priority around counter-UAS readiness and the need for trusted, scalable technologies," he said. "This award is an important validation of our strategy to build a leading autonomous defense technology platform."

Debora Fortkamp, Chief Strategy Officer at HIFraser, added: "We are proud to partner with Ondas Sentinel to bring cutting-edge single-operator counter-UAS capability to Australian forces."

But it's not all clear skies. Short interest in Ondas has been climbing. During the latest reporting period, short interest jumped from 167.52 million shares to 197.58 million, meaning 34.89% of the publicly available stock is now sold short. With average daily volume of 64.80 million shares, it would take short sellers about 3.05 days to cover their positions. That's a lot of bearish conviction, and it could fuel a squeeze if the stock keeps rising.

Investors also have earnings on the horizon. Ondas is set to report second-quarter results on August 11. Analysts expect a loss of 6 cents per share on revenue of $65.80 million.

Technically, the stock is still in recovery mode. At $7.08, it was trading 6.4% below its 20-day simple moving average of $7.56 and 22.8% below its 50-day SMA of $9.17. That keeps the intermediate trend tilted lower. The bigger picture is also heavy: the 50-day SMA crossed below the 200-day SMA in July — a classic death cross — which often turns rallies into "sell-the-rip" opportunities. So while Tuesday's pop is nice, the technicals suggest caution.

For now, though, Ondas shares are up 9.83% at $7.54, and the Australian defense contract gives bulls something to point to.