Replies to post #93350 on Triple 000 and Sub-penny Chart Plays

[trader53]

ICNB - Short Positions - What if ?

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[trader53]

ICNB - Short Positions - What if ?

* How a "Short Squeeze" happens !


For all intents and purposes,
let's say that ICNB, currently at 0.0004,
climbs to 0.0012


Let's say you Sell ICNB stock Short at 0.0012

But, instead of the price going down,
it goes up to 0.003
and appears to be going higher.

Now you're in trouble.

You need to cover your position and limit your losses.

You decide to buy ICNB shares as soon as possible
-- you and everybody else who shorted the stock.

This generates tremendous buying pressure on the stock,
and the short sellers rushing to cover their positions
only escalate the price increase.

Short squeezes
occur more often in small-cap stocks with small floats,
but they can occur with any stock.

http://www.investinganswers.com/financial-dictionary/real-estate/short-squeeze-2045


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