FXCM Short Interest Jumped Nearly 30% Following SNB Currency Move
Loomes commented that his firm’s analysis “suggests short sellers have jumped into opening new positions in FXCM. Interestingly this comes as a total reversal of what short sellers were seemingly thinking before.”
According to Loomes, “data shows that from mid-December, the number of shares being borrowed (the prerequisite and this proxy for short selling them) had fallen steadily, down about 22 percent by the start of last week.”
After the Swiss National Bank abandoned its peg to the euro, however, “borrowing of FXCM shares jumped 29 percent in just two days, suggesting short sellers are expecting only further losses in the cash market for the FX broker.”
Shares of FXCM traded in the $12 to $14 range on January 15. After the SNB move, shares crashed and traded below $2.00 on January 20.
FXCM recently traded at $2.82, up 21 percent.
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