After one of the most violent and memorable short squeezes in recent memory sent DryShips Inc. DRYS 9.67% shares soaring from as low as $3.84 to as high as $102.00 in a matter of days, the stock has now crashed back down to earth at around $10.
Learning From DryShips
Following the DryShips reality check, short squeeze traders may be shifting their attention to a new target on Monday: LendingClub Corp LC 2.53%. Shares of the battered marketplace lending stock jumped from a session low of $5.93 to a session high of $6.16 within a matter of minutes on Monday morning following a market rumor of a potential buyout. The stock quickly fell back to around $6.00 when there was no follow-up on the chatter, but the move certainly caught short squeeze traders’ attention.
Short Sellers’ Nightmare: The Buyout
A buyout can be a short seller’s worst nightmare. No matter how well-researched a company is or how confident a short-seller is in the negative fundamentals or technical momentum of a stock, buyout rumors are always a dangerous wildcard.
LendingClub is one of the most popular shorts in the market today at about 17 percent short interest. Short sellers have piled…
Click here to continue reading
Want to learn more about how to profit off the stock market? Or maybe you just want to be able to look sophisticated in front of your coworkers when they ask you what you are reading on your Kindle, and you’d prefer to tell them “Oh, I’m just reading a book about stock market analysis,” rather than the usual “Oh, I’m just looking at pics of my ex-girlfriend on Facebook.” For these reasons and more, check out my book, Beating Wall Street with Common Sense. I don’t have a degree in finance; I have a degree in neuroscience. You don’t have to predict what stocks will do if you can predict what traders will do and be one step ahead of them. I made a 400% return in the stock market over five years using only basic principles of psychology and common sense. Beating Wall Street with Common Sense is now available on Amazon, and tradingcommonsense.com is always available on your local internet!
