How does 7 Days of Short Interest sound? $SONO – April 11, 2023
This is Scott with your Chart of the Day. I want to take a look at Sonos ( NASDAQ: SONO ). This is actually an idea from our active Trading Room at StockMarketMentor.com. And this is an idea that I picked up from one of our longtime members. It is a chart that I think is really interesting because not only is it above all the major moving averages here, but it has a fair bit amount of short interest. Sonos ( NASDAQ: SONO ) actually has about 10 percent of their float, short.
Now, my thought is, that if the market squeezes higher, I am talking about the market generally, then this stock could have a little extra fire in that move if those shorts start to cover. And so what I want to see here from Sonos ( NASDAQ: SONO ) is a potential move above this resistance zone, right around 20.50.
As you can see back here in the early stages of March it couldn’t get above that level. It pulled back to the 50-day moving average, and now we are right under that level again. And so if I was a short seller I would definitely move my stop to around this area, or at least around this high over here around 21.50.
I think we could get, potentially, some short covering with a breakthrough there. And then, certainly, with a breakthrough there. So some pretty key zones here on Sonos ( NASDAQ: SONO ) that I think, if the shorts cover, could give the stock somewhat of an outsized move.
So this is definitely a stock that I have on my watch list and I think you should definitely consider adding it to yours.
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