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3 Big Short Interest Names With Bullish Setups
Written by Ryan Hasson. Published 9/22/2025.
Key Points
- Market momentum remains strong, with speculation rising but not at extreme levels, creating room for further upside.
- HIMS, DLO, and TEM each combine bullish technical setups with elevated short interest, making them prime candidates for potential squeezes.
- While speculation may eventually cool, the current backdrop supports momentum, and these names stand out as high-upside potential opportunities.
Last week, several momentum-driven, high short-interest stocks surged as the broader market hit fresh highs. While this level of euphoria raises questions about sustainability, history shows momentum can carry further than skeptics expect.
As Warren Buffett famously said, "The market can remain irrational longer than investors can stay solvent."
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The Fear & Greed Index reads 62, reflecting greed but not extreme levels. Likewise, the SPDR S&P 500 ETF Trust (NYSEARCA: SPY) holds an RSI of 71—stretched but not yet overbought. In other words, momentum may still have room to run. Against that backdrop, three heavily shorted stocks boast technical setups that could fuel further upside if sentiment stays supportive.
HIMS: A Retail Favorite on the Edge of a Breakout
This year, Hims & Hers Health (NYSE: HIMS) has drawn scrutiny from Washington regulators over advertising practices and the telehealth distribution of GLP-1 weight-loss drugs. Last week, the FDA posted over 100 letters to companies—including Hims & Hers—as part of a broader crackdown on pharmaceutical corporations.
Despite these headwinds, the stock's performance has been extraordinary: up 139% year-to-date and 259% over the past twelve months.
Technically, HIMS has consolidated since May in a range between $40 support and $65 resistance. On Friday, the stock pushed toward $60, signaling a potential retest of that upper boundary.
What makes the setup especially compelling is the 38% short interest—more than 74 million shares sold short. A decisive break above $65 could spark a powerful squeeze, adding fuel to its strong momentum.
DLO: Strong Earnings Meet Heavy Shorts
DLocal Limited (NASDAQ: DLO), a fintech specialist in cross-border payments for emerging markets, was largely off the radar until its latest earnings report, where it beat revenue and earnings estimates convincingly.
That performance helped DLO break out of a long base, lifting shares nearly 40% year-to-date. Wall Street has taken notice, boosting the consensus price target from $12.45 three months ago to $14, alongside multiple upgrades.
But the technical picture is only part of the story. DLO carries significant 23.4% short interest, nearly 15 million shares. Trading just above $15, the stock could trigger another leg higher if it holds this level and pushes through earnings-gap resistance near $16.
TEM: A High-Short AI Healthcare Play
Tempus AI (NASDAQ: TEM) has been one of the standout performers of 2025, with shares up more than 160% year-to-date. The rise is driven by the company's use of artificial intelligence and machine learning in precision medicine.
Tempus's core strength lies in oncology, providing genomic profiling, digital pathology, and data-driven insights to support personalized cancer care.
The stock is now approaching a key inflection point, consolidating beneath its all-time high near $91. With 25% short interest, a decisive breakout could trigger a short squeeze and send the shares even higher.
Momentum Remains Firmly Intact
The broader market may be stretched, but momentum remains intact—and high short-interest names are often the biggest beneficiaries in such environments. HIMS, DLO, and TEM each combine strong technical setups with elevated short interest, giving them the potential to squeeze higher if bullish momentum continues.
While speculation will eventually cool, the current backdrop is supportive. For investors seeking intriguing bullish setups, these three names stand out in today's market.
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