Instead, it looks like a short squeeze is taking place. When this happens, traders get together to buy up shares of the stock in order to increase its price. Doing so can force short sellers out of their short positions while traders take in the profits.
Backing up that idea is heavy trading of FFIE stock today. As of this writing, more than 40 million shares of the stock have changed hands. That’s a massive increase compared to the company’s daily average trading volume of about 5.4 million shares.
Investors considering jumping into FFIE stock right now will want to be careful about doing so. While a short squeeze can send a stock soaring higher, it’s also common to see that stock come crashing down after the squeeze is done.
In that regard, a short squeeze is similar to a pump and dump of a stock. That means that investors that are late jumping into a short squeeze might end up holding the bag when other traders sell off their shares.
All of this activity today has shares of FFIE stock up 24.5% as of Thursday morning. For the record, FFIE is still down 7.7% since the start of the year.
Investors looking for more recent stock market news are going to want to stick around!
We’ve got all of the latest stock market coverage that traders need to know about! For Thursday, that includes what’s going on with shares of Helen of Troy (NASDAQ:HELE), chip companies, and Bed Bath & Beyond (NASDAQ:BBBY) stock. You can get up to speed on all of this at the following links!
More Thursday Stock Market News
- Helen of Troy (HELE) Stock Falls After Cutting Full-Year Outlook
- Why Are Chip Stocks NVDA, INTC, QCOM, AMD Up Today?
- CEO Sue Gove Is Making a Big Bet on Bed Bath & Beyond (BBBY) Stock
On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.