EarningsBeats Digest

Published: Fri, 12/18/20

EarningsBeats.com Digest for December 18, 2020

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A Strong Leader In Retail Still Has A BIG Short % Of Float

We updated our Short Squeeze ChartList at EarningsBeats.com for our members today and it surprised me that Carvana Co. (CVNA) remained as one of the most heavily-shorted stocks. Despite a near 50% move higher just since its low of 182.06 on November 10th, CVNA's short percentage of float fell just 1% from 28.95% to 27.93%. That's one stubborn group of short sellers. However, as long as CVNA remains in its current uptrend, that's very good news for longs as short sellers represent guaranteed buyers at some point. If CVNA continues its current uptrend, you've got to believe nervous shorts will only add to the buying frenzy:

Note the last pullback in early December tested the rising 20 day EMA and bounced right back to fresh new highs. That's very bullish action. Now the rising 50 day SMA is approaching that December low, so that would provide two big reasons to buy IF CVNA did manage to sell and consolidate for a period of time. Currently, I just see the uptrend and that rising 20 day EMA. Like I said earlier, if this uptrend continues, pressure will only mount for those betting against the company.

Happy trading!

Tom Bowley, Chief Market Strategist

EarningsBeats.com

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