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Wed, April 5 at 4:00PM ET

Vinco Ventures (BBIG) Stock Pops 20% in Short Squeeze

  • Vinco Ventures (BBIG) is up almost 20% on Tuesday, as BBIG stock rallies on a short squeeze.
  • While short squeezes can lead to large, short-term rallies in the stock price, they are rarely dependable or sustainable.
  • The company has had compliance issues with the Nasdaq, and while the higher share price is nice, it does not fix the company’s fundamental issues.
BBIG stock - Vinco Ventures (BBIG) Stock Pops 20% in Short Squeeze

Source: shutterstock.com / Postmodern Studio

The stock market is trying to start the holiday-shortened trading week on a bullish note, but it’s struggling to get going. The same cannot be said for Vinco Ventures (NASDAQ:BBIG), as shares are exploding higher. BBIG stock is up almost 20% so far on Tuesday, the first trading session of the week.

Helping drive shares higher? An apparent short squeeze. According to Fintel, BBIG stock has a short interest of more than 17.5%. While that’s not astronomically high, it can lead to a bit of a squeeze under the right circumstances.

At one point, BBIG stock was up more than 28% in the session, tagging a high of almost 87 cents. The move sent the stock to its highest price since Nov. 15 and is occurring on high volume. So far, Tuesday’s volume of 26 million has already eclipsed Friday’s volume of 18.2 million, a session in which Vinco Ventures shares rallied more than 25%.

Shares are currently riding a three-day, low-to-high rally of more than 73%. Even though that rally will not be sustainable forever, short squeezes can be painful for the bears.

Will a Short Squeeze Turn Things Around for BBIG Stock?

In January 2021, a short-squeeze bonanza triggered some truly breathtaking rallies in the stock market. Led by names like GameStop (NYSE:GME), AMC Entertainment (NYSE:AMC) and Bed Bath & Beyond (NASDAQ:BBBY), these short squeezes sent stock prices exploding higher. For what it’s worth, all of these stocks are trading higher today.

Of course, the run in 2021 ultimately ended in destruction for these names. BBIG stock is on that list too.

Shares topped out near $8.50 in September 2021 and have been crushed ever since. When the stock made a 52-week low at 41 cents on Dec. 29, it was down more than 95% from the all-time high.

For those looking at a short squeeze to save Vinco Ventures, maybe they ought to look elsewhere for catalysts.

A short squeeze is nothing more than a technical catalyst for a stock price. It does not tend to lead to long-lasting rallies. It also doesn’t change the fundamental situation for the company either. If shares do continue to rally, perhaps the 200-day moving average may be in play, currently up near $1.15. Again though, this would be purely driven by the technicals.

As if the stock price weren’t enough of an issue, the Nasdaq notified Vinco about a non-compliance issue. Specifically, it came after the company failed to file its financial reports in a timely manner.

So it’s not only a tumultuous C-Suite issue that’s hampering the stock — there are several issues.

Even trading BBIG stock should be considered speculative at this point.

On the date of publication, Bret Kenwell 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.

Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell.

Article printed from InvestorPlace Media, https://investorplace.com/2023/01/vinco-ventures-bbig-stock-pops-20-in-short-squeeze/.

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