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Shorts Get Squeezed as Breadth Expands

February 17, 2025

As more stocks, more sectors and more countries around the world start to participate in this bull market, any of the short sellers who overstayed their welcome are getting blown up.

Good.

This is a classic characteristic of healthy bull market environments. I would encourage you to go back and study every bull market ever. You'll find that investors who own stocks are much more profitable than those who are selling stocks.

It's just math.

Here's the thing about short sellers that I think gets forgotten. Short sellers are guaranteed future buyers. Longs are only promising to be future sellers. 

The thing is that when shorts are getting squeezed, these can become forced liquidations. And margin clerks don't use limit orders. They'll spray the market, and it will crush you if you're on the wrong side of that.

But if you're on the right side - pay day!

Here is a list of stocks where short sellers are the most vulnerable to get blown up:

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Nasdaq100 Hits New All-time High

February 14, 2025

Yesterday we saw the Nasdaq100 close at new all-time highs, on an equally-weighted basis!

I keep being told that market breadth is weakening, mostly from people who haven't even bothered to count. 

So let me ask you...

Is the equally-weighted Nasdaq100 closing at the highest level in its entire history evidence of broadening strength, or a weakening market?