I don't think the shorts have covered at all. There are too many shares to cover. There are not that many genuine sellers in the market, not at this price anyway. The moment they start to buy in the price will rise. When the stock price goes up they will not get any more proceeds from their brokerage to short further and if the price exceeds their breakeven points which should be less than $2 now, margin calls will start to come in. So they will not take that chance. The shorts will try to depress the price further and the further it goes down the more margin their brokerages give to them to further short the stock. The primary aim is to cause a panic, which can drive the price further down and they get more margin to short further until the price reaches very low or zero. However, if the panic does not come, the company remain robust or if regulatory bodies start to investigate and take action against them for price manipulation or there is a take over bid or buy out or if there are big buyers in the market snapping up all the cheap shares thrown out or their brokerages get sued by shareholders for failing to deliver the spin-off shares, their plan may not work out as well. If they fail the short squeeze will come. The more they drive it down the lower will be their breakeven points the greater will be their exposure.
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