Somebody Is Still Shorting $LCID. The Data Says They May Regret It

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Lucid Group, Inc. Common Stock keeps going up and the short keeps pressing. One of those has to give.

$LCID sits at $3.33, $0.56 below its 20-day high of $3.89 and $0.48 above its 20-day low of $2.85.

My read: lean bullish. Buyers are close enough to force the issue, but I want volume before I call it a breakout.

The shorts have a problem

Against its own 60-session range, $LCID is 51.0% below the high of $6.81 (Aug 12) and 17.0% above the low of $2.85 (Oct 20). $LCID closed higher in 4 of its last 9 sessions.

Volume over the last five sessions averaged 1.2x the twenty sessions before them. The largest one-day move in the past twenty sessions was +11.6% on Nov 4.

51% of LCID's off-exchange volume printed as short sales (FINRA daily short volume), against a normal 56%.

Days to cover: 9.7. Every short in the name needs 9.7 full days of normal volume to get out.

What I make of it: a crowded short matters only if the stock stops falling, and then covering becomes buying. Whether that starts here is the whole question.

Who is positioned for what

Off-exchange trading: NORMAL: no block prints, 59% off-exchange. No block-size prints (10,000+ shares or $1M+) in this window. Off-exchange volume is spread across small prints, which is what internalized retail flow looks like. In options, dealers long gamma, call wall $3.50, put wall $3.00, gamma flip near $1.00, hedge pressure 0% of an average day's volume.

Days to cover 9.7, 99.7M shares short, short interest +5.6% since the last report.

Squeeze risk 19 of 100; shorts pressing 71 of 100. Across the broader market, the read is Neutral (bias -8). Sentiment readings show bullish (75 of 100).

What I make of it: the data agrees with itself more than it argues, and that counts for something. It still falls short of proof.

The bull case

• Short squeeze setup with a measured path to $3.61

The bear case

• Backdrop: Neutral (bias -8)
• High short volume is routine in liquid names

What I think traders are overlooking

What I think traders are overlooking is how close the call wall sits to my target. The strike where the calls are stacked can pull price toward it or pin it there, and that makes it a level to watch, not a prediction.

None of that is visible in the candles.

What happens next, and when I'm out

If $LCID posts a close above the recent high on rising volume and volume expands, I think $3.61 becomes the next serious test. Under $3.00, I'm wrong.

The honest objection is that short volume is not a short position. A high ratio is routine in liquid names, and sometimes the shorts are simply right.

Clear the level on volume and I'm interested. Fail below the line and I'm out of the idea.

Kill switch

Any one of these and the thesis is over, no averaging down, no renaming it.

• A close through $3.00.
• Selling absorbs the buying at a key level and price loses it on volume.
• Order flow reverses: the sweeps and blocks turn to the other side.
• A scheduled event changes the picture before the trigger is reached.

My read

I lean higher, not loudly. The setup earns the lean and not the conviction, and it gets the conviction only when volume shows up.

Desk record. 25 of 140 scenario targets traded before their invalidation (18%), 75 stopped out, 40 ran out of time, average outcome +1.18% per piece. Past pieces say nothing about this one.

The desk's scenario leans bullish. Bull or bear, the kill switch above is what keeps either view honest.

Sources and further reading: SEC EDGAR filings for LCID · FINRA daily short sale volume files · Nasdaq short interest: LCID · Cboe options quotes: LCID · Lucid Group, Inc. Common Stock investor site · LCID quote, chart and data on StockMarketLoop.

Data as of Nov 5, 8:42 AM ET: options positioning, FINRA short volume, the off-exchange trade record, the structure map, SEC filings and the ticker's headlines. Vaughn McNair (Grandmaster-Obi) and Making Easy Money may hold or trade positions in the names discussed. This is speculation and education, not financial advice.