If you already love trading short squeezes from the long side, this won’t be a surprise.
But I know many new or inexperienced traders who see a chart like this…
Source: Stocks To Trade
VEEE, 7/14/26, 1-min candle, chat pump turned short squeeze.
And wonder…
How do I even trade something like that?
The answer might surprise you…
Big Short Squeezes Are Great for Longs
The first question many people asked was: “Tim, why did VEEE move like that?”
Let’s pick it apart.
First, Twin Vee Powercats Co. (VEEE) announced a merger.
Then, VEEE was in a chat pump…
What does all this have to do with VEEE turning into a big short squeeze?
First, VEEE is a micro-float stock.
Then, short sellers did what they always do…
Toxic, overaggressive short sellers laugh at the news.
Most companies with a long-term chart that looks like this are TERRIBLE…
Source: Stocks To Trade
VEEE, 5-year, weekly candle.
Keep in mind that VEEE NEVER traded anywhere near $3,000 per share.
The company did a 1-for-37 reverse split on May 4, 2026.
It also did a 1-for-10 reverse split on April 8, 2025.
That means every share today was 296 shares just over a year ago.
Why the reverse splits? Because the Nasdaq has a $1 minimum bid price to remain listed.
Almost all these small companies are fundamentally flawed. And most are in trouble.
In other words, terrible companies do reverse splits just so they can keep trading.
Enter the Toxic Short Sellers
This is where it gets fun.
First, the company announces the merger. Then, the chat guy pumps the stock like crazy, scalping along the way as his followers buy.
And then…
The short sellers look at the long-term chart, look at the fundamentals, and start frothing at the mouth with greed.
And then you end up with a 1-day chart that looks like this…
Source: Stocks To Trade
VEEE, 7/13/26, 1-min candle, shorts still feeling the pain.
Here’s the problem…
Smart Longs Understand What’s Happening
The best part about these crazy big short squeezes is that you don’t have to trade every one.
In fact, if you’re new, simply watching will help you understand how they move.
Yes, they can be scary (especially when they get halted like VEEE did several times).
But once you get used to seeing how they move, you can try a few shares.
You can trade small until you’re comfortable with how they trade.
Most importantly, when these big short squeezes happen, I encourage you to lock it in along the way.
I CONSTANTLY remind students to lock in gains along the way and cut losses quickly if the trade turns against you.
Be Prepared for Supernova Summer
The key to making these big short squeezes work for you is to have meticulous risk management.
Poor risk management is what gets the dumb short sellers into trouble in the first place.
We’ve seen a TON of massive short squeezes lately.
And it is BEAUTIFUL for longs.
Remember, if you trade scared, trading isn’t scary.
Just be sure to NEVER fall into the trap the short sellers fall into on every one of these big squeezes…
They get greedy.
It’s not that they’re wrong about the company or the catalyst.
It’s that they have ZERO risk management.
(Check out this to make sure you’re mastering risk management like a pro.)
So, stay disciplined, crush the greed and you can learn to take advantage of short squeezes, too.
By the way…
VEEE squeezed more in after-hours trading…
Crazyyyyy to see how VEEE hit $41 after-hours, up from the premarket $12s — nearly a quadruple today.
Despite how many of my students and I made $500, $1,000, $2,000, some even making $10,000-$20,000, we… ALL sold too soon!
But, wheeeewwww!
I LOVE this SUPERNOVA SUMMER!
If you have any questions, email me at SykesDaily@BanyanHill.com.
Cheers,
Tim Sykes
Editor, Tim Sykes Daily
