SOXX rallied nearly 6% on the week, yet the bears haven't moved on — short interest remains elevated at 15.8% of float while options positioning has turned more defensive than at any point in months.
The borrow picture has shifted meaningfully since Wednesday's convergence report flagged critical tightness. Availability has recovered from 23.2% on May 27 to 41.9% by Thursday's close — still well inside the very tight range, but a clear loosening from the extreme levels seen mid-week. Cost to borrow has also eased, dropping 21% on the week to 1.12%. Short interest itself barely moved — 8.89 million shares short versus 8.89 million the day prior — which means the recovery in availability reflects a larger lending pool opening up, not shorts exiting. Bears are staying put; the borrow market is simply breathing a little easier around them.
The options market has taken a sharply more defensive turn, and that is the most notable development of this week. The put/call ratio jumped to 3.54 on Friday — more than two standard deviations above its 20-day average of 3.12 — and is approaching the 52-week high of 3.73. For context, the ratio has trended structurally elevated on SOXX (the 52-week low is 1.28), but this week's reading represents a distinct spike within an already cautious baseline. Options traders are paying up for downside protection even as the ETF prints fresh near-term highs.
Those two signals — short sellers sitting tight and put demand jumping — create an unusual setup given the price action. SOXX has gained nearly 30% over the past month and closed Friday at $569.08. Yet the ORTEX short score remains elevated at 65.5, essentially flat across the past two weeks. That score has not declined despite the rally, suggesting the data inputs driving short-side positioning — borrow demand, SI levels, lending tightness — have not yet responded to the price recovery in the way they typically would in a short squeeze.
On the institutional side, Goldman Sachs added 484,000 shares as of the March quarter-end, the largest reported increase among top holders. Bank of America and BNP Paribas also built positions meaningfully, while Morgan Stanley trimmed by 134,000 shares. Jane Street and D.E. Shaw each reported first-time holdings — two active trading firms establishing fresh exposure. That institutional inflow provides a demand-side counterweight to the elevated short positioning, though the March quarter-end date means these figures predate the April volatility and the subsequent recovery entirely.
The key tension heading into next week is whether the borrow market tightens again. Availability came off its mid-week extremes but remains far below normal levels. If the lending pool tightens back toward the 15–23% range seen Monday through Wednesday — particularly if the ETF continues to climb — the combination of high short interest, near-record put demand, and a shrinking borrow pool becomes the story again.
See the live data behind this article on ORTEX.
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