SOXX posted its best single day in weeks on Tuesday, jumping 5.4% to $552.69 — yet the shorts who rebuilt aggressively through late June and early July have barely flinched.
The short interest story here is the continuation of a trend flagged in last week's note. Shorts peaked near 22.2% of free float two weeks ago, dipped briefly in early July, and have now settled at 21.7% — still deeply elevated and essentially unchanged on the week (+0.3%). The more telling number is the one-month move: short interest has risen 21.7% over that period, representing a near-doubling from the 10 million share level seen in mid-June to 12.2 million shares now. Tuesday's sharp bounce trimmed the position only fractionally (-0.1% on the day), suggesting bears treated the rally as noise rather than a reason to cover. The ORTEX short score of 65.1 is consistent with that read — moderately elevated, reflecting genuine bearish conviction rather than a crowded speculative trade.
The borrow market is where this week's data gets interesting, and it diverges from the prior week's story in a notable way. Availability has loosened sharply — rising from around 52% last Monday to 111% by Tuesday's close, meaning there is now roughly one share available to borrow for every share already lent out. That is a meaningful easing from the tighter conditions seen last week, and it stands in contrast to the extreme squeeze-adjacent levels below 20% that defined early-to-mid June, when the lending pool was nearly exhausted. Cost to borrow has also eased, falling 18% on the week to 0.95% — less than a third of the 3% level seen around July 3rd. Put plainly: borrow is getting cheaper and more available even as short interest stays high. That combination typically indicates shorts are comfortable holding rather than scrambling to add or cover under pressure.
Options positioning has shifted materially over the same period, and the direction of travel is bullish relative to recent history. The put/call ratio has dropped to 1.48, now running well below its 20-day average of 1.96 — roughly 1.2 standard deviations below the mean, and near the 52-week low of 1.28. Six weeks ago, the PCR was above 3.0. The steady compression from those defensive extremes through late June into July tracks almost exactly with the borrow-market easing and the ETF's partial price recovery. Options traders have been reducing downside hedges, even as short sellers hold their positions. These two groups are telling different stories about their conviction.
Goldman Sachs remains the largest disclosed holder at 5.5% of shares, having added 484,000 shares in Q1. BNP Paribas and Bank of America also added meaningfully in the same period, while Morgan Stanley trimmed. The institutional data is as of March 31, so it predates the significant short-interest build that began in mid-June and the 13.6% one-month decline in the ETF's price. Those flows are not yet visible in the holder data.
The setup heading into next week is a study in conflicting signals: short interest anchored at elevated levels by bears who have shown no appetite to cover into strength, set against options traders who are the least defensively positioned they have been all year. Whether Tuesday's 5.4% move marks the beginning of a broader unwind — or simply a relief bounce that shorts will use to re-engage — is the question the positioning data will answer over the next several sessions.
See the live data behind this article on ORTEX.
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