Short squeeze in trading and investment - ForexZig
If the share price rises, short sellers will start to leave their position and buy for coverage.
If investors use a short-covering strategy, they need to buy back borrowed shares to open a short position before the expiration date.
Short squeeze usually take markets by surprise, and oversold indicators and high or low interest rates do not guarantee that short cuts will happen.
Often a short compression is caused by positive news and usually occurs on Friday, when traders do not want to go out for the weekend from a short position when the markets are closed.
To identify short squeeze, many traders will use indicators to find oversold stocks.
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