Short Interest
How many shares are sold short — a crowd of forced future buyers if the trade goes against them.
Reading the TapeBeginner 4 min read· Lesson 7 of 11 in Stock Market Basics
Mechanics of shorting
Short sellers borrow shares and sell them, profiting if price falls, but they must eventually BUY to close. Short interest (often quoted as % of float, or as days-to-cover = short shares / daily volume) measures how big that obligation is.
Squeezes
High short interest + rising price = shorts losing with theoretically unlimited risk. Their buying-to-cover fuels the rally further — a short squeeze. High short interest is simultaneously a bearish opinion poll and squeeze fuel; context (is the bear case broken?) decides which.