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Short Squeeze

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Dictionary Says

Definition of 'Short Squeeze'

A situation in which a lack of supply and an excess demand for a traded stock forces the price upward. During a short squeeze, individuals holding short positions are typically forced to purchase shares in situations where the price increases rapidly, in order to exit their short position. Short squeezes occur more often in smaller-cap stocks with small floats.
Investopedia Says

Investopedia explains 'Short Squeeze'

If a stock starts to rise rapidly, the trend may continue to escalate because the short sellers will likely want out. For example, if a stock rises 15% in one day, those with short positions may be forced to liquidate and cover their position by purchasing the stock. If enough short sellers buy back the stock, the price is pushed even higher.

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