Trading Places with Tom Bowley

Is This Pharma The Next GameStop (GME) Short Squeeze?

 | 

It's been quite a volatile ride today, but one pharmaceutical stock has made 5 years' worth of returns in a couple hours. It's what happens when there's a huge imbalance in demand vs. supply on a stock and it breaks out to new highs. Shorts are scrambling today on Biofrontera (BRFI), a small biopharma company that develops and provides dermatological products for the treatment of skin diseases. BFRI broke out earlier today and now shorts are left with a big decision. Short more or take losses and move on? Currently, BFRI is the #1 stock on our Short Squeeze ChartList (SSCL) that we provide to our members at EarningsBeats.com, and has a short percentage of float of more than 84%, the highest reading I've seen on any stock since GameStop (GME) reached a ridiculous 140%. Here's what's happening today:

BFRI could be absolutely ANYWHERE at today's close. It could be $30 tomorrow or it might fail later today and be cut in half by tomorrow. Short squeezes, or failures, are not at all rational. So if you decide to trade BFRI, just beware of the significant risk associated with it.

Tomorrow morning, I'll feature the second highest short position on our Short Squeeze ChartList, providing annotations and key levels where short sellers might begin to feel a pinch and start to cover shares (buy) in droves, in our EB Digest newsletter. Subscription is free with no credit card required and you may unsubscribe at any time. If you're interested in subscribing and receiving tomorrow's short squeeze stock, CLICK HERE to enter your name and email address.

Happy trading!

Tom

Tom Bowley
About the author: is the Chief Market Strategist of EarningsBeats.com, a company providing a research and educational platform for both investment professionals and individual investors. Tom writes a comprehensive Daily Market Report (DMR), providing guidance to EB.com members every day that the stock market is open. Tom has contributed technical expertise here at StockCharts.com since 2006 and has a fundamental background in public accounting as well, blending a unique skill set to approach the U.S. stock market. Learn More
Subscribe to Trading Places with Tom Bowley to be notified whenever a new post is added to this blog!
comments powered by Disqus