Regional Banks: Massive Short Squeeze Is Underway
August 3rd, 2009
Joe Kunkle submits:
I recently have been noting the strength in regional banks, often tracked via the ETF KRE, which has closed higher for 8 straight sessions. The weekly chart shows a triangle setting up that could result in a breakout at $21, and lead to a massive short squeeze that sends this ETF 50% higher to $31.50.
After a quick scan of the most shorted regional banks the following list came up, and a simple view of the charts shows the massive short squeeze underway. The following names are the most shorted regional banks with bullish chart patterns: PVTB, FMBI, WTFC, CBU, TRST, CVBF, EWBC, WABC, UMPQ, SIVB, BXS, IBOC, and PRSP. Many of these names have a short ratio of more than 12 days to cover, and more than 20% of the float.
