Crypto Stocks Like MicroStrategy, Coinbase Could Shoot Up if Short Sellers Exit

  • 📰 CoinDesk
  • ⏱ Reading Time:
  • 52 sec. here
  • 2 min. at publisher
  • 📊 Quality Score:
  • News: 24%
  • Publisher: 63%

Malaysia News News

Malaysia Malaysia Latest News,Malaysia Malaysia Headlines

Aoyon Ashraf is managing editor with more than a decade of experience in covering equity markets

MicroStrategy and Coinbase have the most possibility of a short squeeze – or a rally spurred by short sellers getting out of their bearish bets – S3 Partners said in a report.

However, the trade has become so crowded that it primed these stocks for a short squeeze, said data analytics firm S3 Partners in aon Monday. A short squeeze is triggered when an unexpected rally in a stock price forces short sellers to unwind their bearish bets, leading to an even bigger jump. "These crypto related stocks are extremely crowded and very squeezable relative to the U.S. market, with an average Crowded score of 57.34 versus the street average of 32.41 and an average Squeeze score of 78.69 versus the street average of 34.41," the report said, adding that"MSTR, COIN and CLSK are the most squeezable names in the sector."The total short interest in crypto stocks is $10.

If a sector becomes too crowded with short sellers, such a trade can become dangerous if the share price of a shorted stock continues to climb, forcing investors to scramble to cover their shorts, leading to massive losses. In recent years, short squeezes in GameStop and Tesla led to disaster for short sellers.

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.
We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 291. in MY

Malaysia Malaysia Latest News, Malaysia Malaysia Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Stocks making the biggest moves premarket: Chipotle, MicroStrategy, CarMax, Intel and moreThese are the stocks posting the largest moves in premarket trading.
Source: CNBC - 🏆 12. / 72 Read more »