From the Desk of Steve Strazza @Sstrazza

Last week, we released a Freshly Squeezed report detailing long setups in some of the market's most heavily shorted stocks.

This week, we got fresh short sale data from FINRA as well as fresh breakouts from a growing list of stocks in our universe.

We thought it would be irresponsible not to do a follow-up report covering them.

This is just the environment we're in.

Here's what we're doing about it.

Our scan is quite simple. It is designed to identify stocks with the highest short positions. When a stock is heavily shorted, incremental buyers are waiting in the wings to close out their bearish bets.

We love this, as new buyers are the one true catalyst for higher prices.

When shorts are proven wrong, they become buyers of the stock. Many times, as this happens, momentum comes into these names and fuels massive short-covering rallies.

For this reason, we pair short-interest data with short-term momentum overlays, as this combination is needed to spark the moves we’re looking for.

Here's the latest list:

From the Desk of Steve Strazza @Sstrazza

The animal spirits have returned to equity markets near you!

How do we know?

Take a look around...

Biotechs are putting the finishing touches on a massive base, suggesting a new bull market for these stocks is underway.

Speculative growth indexes like the suite of ARK ETFs are completing (or have already completed) trend reversals.

The Renaissance IPO fund is at its highest level since early 2022.

A growing list of emerging markets countries (outside of China) are making new highs.

Cryptocurrencies are mooning every night while we're sleeping.

Participation is broadening to new groups like materials, and funds are flowing back into energy and financials again.

The most-hated and lowest-quality stocks in the market are catching a serious bid.

So, what do we do?

This is the optimal market environment for our Freshly Squeezed universe.

The idea behind this one is to find the stocks that bears are betting against the most and take the opposite side as they squeeze higher.