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Can anyone help me with this question; I recently read the following quote in a Biolase post and immediately wondered what a short squeeze is??
"Biolase still looks like good buy -- even more so after its recent weakness. Special-situations investors may also want to consider nibbling. If shorts' claims are as erroneous as my research indicates, a massive short squeeze will come eventually."

Any comments??
juanfester
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Greetings juan,

Here's the definition of a short squeeze:
"A situation in which the price of the stock rises and investors who sold short rush to buy it to cover their short position and cut their losses. As the price of the stock increases, more short sellers feel compelled to cover their positions."

Thus in relation to your post, the quoted individual believes the stock price will rise enough to start a chain of events where those that have sold the stock short will cover and this will lead to more covering. How correct that individual is, time will tell.

Regards,
JB
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Thanks JB,
I had a feeling it was something like that. Would I be correct in assuming then that this could possibly intensify any rebound, which in effect "could" cause the stock price to temporarily excede what would be considered a fair trading price.
Therefore being long on the stock myself I should expect a roller coaster ride in the coming months.. or, at the least, not be surprised when it happens.
Juanfester
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Greetings Juan,

Yeah that would be correct.

Regards,
JB
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