Mastering the Madness: Seven Relative Strength Movements Fueling the Meme Stock Frenzy

Short Squeezes

The third movement is short squeezes. A short squeeze occurs when a stock's price increases drastically, forcing short sellers to buy the stock to cover their positions, which further drives up the price. This strategy was seen in the GameStop frenzy, where retail investors targeted stocks with high short interest, causing a massive short squeeze. This relative strength movement demonstrates the power of collective action in the stock market.