There may be a Marathon (NASDAQ:MARA) stock short-squeeze in the making today as the crypto mining company surges as Bitcoin (BTC-USD) inches past the all-important $45,000 psychological barrier.
What’s up with MARA stock lately?
Well, MARA is up a surprise 20% today, likely benefiting from the rise of the price of the primary commodity it mines: Bitcoin. Indeed, BTC is up 5% over the past five trading days, recently even crossing the $45,000 per coin threshold.
While the stock is likely receiving a boost from Bitcoin’s recent climb, it’s likely not what’s behind today’s jump, at least not entirely. According to data from the financial data site Fintel, MARA stock has a notably high short interest.
MARA has a 22.36% short interest, far higher than most normal securities. This suggests that the stock’s recent surge may be the result of an ongoing short squeeze.
Is There a MARA Stock Short-Squeeze in the Making?
A short squeeze entails an organized effort to raise the price of a security as part of a plan to force those who hold short shares of said security to sell their holdings, thus pushing the stock up even more. As stock prices rise, those with short positions on the security are “squeezed” into selling as a way to avoid sometimes substantial losses.
Short squeezes have become something of a mainstay among Reddit investors, with companies like Tesla (NASDAQ:TSLA) and GameStop (NASDAQ:GME) experiencing historic rallies off the back of investor manipulation. The latter, in particular, saw the video game retailer climb to an all-time high of $500 per share, from just $17, purely from the effort of thousands of r/WallStreetBets investors.
While it’s difficult to tell if today’s jump falls into short-squeeze territory, MARA’s high short interest certainly strengthens the case.
After today’s gains, MARA stock is still down more than 8% year-to-date, though the company is up 209% in the last 12 months.
On the date of publication, Shrey Dua did not hold (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.
