Massive $180M in Failed Trades in March Raises Short Squeeze Speculation Around Strategy Stock

$180M in Failed Trades Could Spark a Short Squeeze in MSTR, Analysts Warn

MicroStrategy (MSTR) is facing mounting pressure, with $180 million in failed trades recorded in March, triggering speculation that a short squeeze could be on the horizon. This surge in trade failures, combined with high short interest, has market watchers on edge.

According to Fintel and SEC filings, more than 609,000 MSTR shares failed to settle in March, a signal that short sellers are struggling to cover their positions. These failures to deliver (FTDs) occur when sellers can’t provide the shares they’ve sold on time, a problem that can indicate tight supply in the market, particularly in heavily shorted stocks.

The issue peaked on March 26, when nearly 186,000 shares worth about $64 million failed to settle. Similar spikes occurred on March 17 and 21, raising concerns that the stock could be nearing a breaking point.

MSTR continues to carry significant short interest, with 29 million shares shorted, or roughly 12% of its float. Nearly a third of MSTR’s trades are occurring in dark pools, adding another layer of complexity to tracking the real-time pressure on the stock.

Despite the failed trades and short interest, MSTR’s price has surged 35% since March 1, and it gained another 8% on April 22 alone. If short sellers are forced to cover, the resulting buying pressure could send MSTR’s price even higher, potentially triggering a full-scale short squeeze.

While failed trades alone aren’t a guaranteed indicator, the combination of rising prices and persistent short interest suggests that MSTR is becoming a ticking time bomb for short sellers.