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Short-squeeze

When the price of a instrument rises rapidly it "squeezes" those investors who are short the instrument because they are forced to liquidate their positions at a very unfavourable price. The demand is greater than the supply, which drives the price of the security even higher, creating a huge profit for long investors. This kind of situation is seen very often in commodities like gold and oil, which can become very volatile



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All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
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