Replies to post #33805 on CBA Florida Inc. (fka CBAI)

[holter]

magtv, Think of it as the oposite of you buying the stock at .012 and it dropping from where you entered, you would be tempted to cover your purchase as it drops to preserve some of your capital. When you sell you stop the loss or effectively cover or protect your purchase capital as much as possible.

So the oposite would be someone sold short at .012 and made money all the way down to where they buy to cover their short sale. When the stock quits dropping and starts going back towards their purchase price they are losing some of their gain. That is what triggers a short squeeze and makes the short sellers cover through buying shares causing the price continue back up and maximising their gains.