Biggest Short Squeeze In 38 Months Sparks Stocks Triple-Decouple

"Most Shorted" stocks are up 4.75% from yesterday's lows - the biggest squeeze since October 2011.

 

 

Sending Small Caps up 4.5%...

 

This squeeze has entirely decoupled US equities from VIX...

 

from credit...

 

and from crude oil...

 

But when did any of that matter...

 

Charts: Bloomberg

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Moon Kil Woong 9 years ago Contributor's comment

I think most of the shorts are just downside protection. The strong rally is just the concerted plunge protection team that has been manipulating the market similarly for years now. Enjoy the gains and resume whatever strategy you had before the run up. Nothing much has fundamentally changed, and if the Federal Reserve doesn't raise interest rates it may imply a much worse outcome than them raising rates due to an improving economy with inflation.