Short sellers are back in full force striking upon AMC Stock and now APE stock. AMC and APE are both heavily shorted as of recent VIA ortex.
There has already been a controversy around the new APE stock with brokers showing an excess of shares that don’t match with the amount of total issued shares.
Many critics of AMC and APE stock might point to the retail community when it comes to both of the stocks selling off as of lately.
In the Screenshot down below, we see “orders by fidelity customers”
This shows top buys and sells on the retail side of things for fidelity customers, which can be a decent indicator for what the retail investors are mostly trading on any given trading day.
As of around 12est the top #1 and #2 are $APE and $AMC stock which a majority of buy orders VS sell orders.
Short sellers are targeting APE stock early into APE’s journey in the market. Ortex explained in a tweet “If 159M AMC shares were already On Loan, then that can be considered a relative starting point for APE shares On Loan when it started trading. $AMC and $APE now trade separately, and corresponding #ShortInterest and lending data will fluctuate independently going forward.”
What some short sellers might not realize is how a perfect short squeeze setup might be forming for both AMC and APE stock due to the high short interest as well as the strong retail community around both names and high trading volume.
Let’s dive into what a short squeeze setup really is.
Short squeeze defined on Investopedia: A short squeeze is an unusual condition that triggers rapidly rising prices in a stock or other tradable security. For a short squeeze to occur, the security must have an unusual degree of short sellers holding positions in it. The short squeeze begins when the price jumps higher unexpectedly.