At EarningsBeats.com, we keep a Short Squeeze ChartList (SSCL). There are currently 42 stocks on it that have very high percentages in terms of short percentage of float. What these stocks have in common is a propensity for short sellers to panic and cover their short positions as price action moves higher and higher. With most investments or trades, we can’t lose more than our investment, while our upside is unlimited. Short sellers face the opposite scenario. They can only make so much, while their potential losses are unlimited if a stock begins rising. It forces them to trade emotionally, buying shares as prices continue to soar.
Enter Wayfair (W). While the S&P 500 index has gained 3.47% year-to-date, W skyrocketed more than 20% on Friday alone and its breakout could force emotional short sellers to send the stock into the stratosphere. Check this out:
Will Friday’s massive volume breakout trigger a tsunami of buying into next week? We’re about to find out. In the meantime…
35 of our 42 short squeeze stocks have outperformed the S&P 500’s gain of 3.47% year-to-date. But are you ready for this? Half of these 42 stocks are already up 20% or more in 2023. Short sellers are near “panic stage” and returns from these stocks on the long side can escalate incredibly fast. Four of these stocks have skyrocketed more than 65% higher and one is up 185% since the beginning of this year.
If you’d like to start a 30-day FREE trial with EarningsBeats.com and immediately gain access to our Short Squeeze ChartList (SSCL) – you can download it right into your StockCharts.com account! – CLICK HERE. We also have a Q4 Earnings event on Monday at 4:30 that you can attend. I suggested to our members that we’d see a very positive report from Netflix (NFLX) last week and the stock surged after reporting that subscribers came in WAY AHEAD of estimates. There’s a critical technical piece of evidence that helps guide me as companies get set to report results and I’ll be discussing that with our members during tomorrow’s Q4 Earnings event. I’ll provide you my Top 10 earnings calls over the next few weeks, as well as the Top 10 stocks that I’d definitely want to avoid. I hope you’ll try our service and join me tomorrow!