AI strategy combined with short squeeze effect drives SpaceX's stock price to rebound 40% in 10 days.

SpaceX’s shares surged 9.7% on Wednesday, closing at roughly $146.15, bringing its rally to about 40% from the low hit on August 3. Analysts cited factors driving the rebound, including Elon Musk’s emphasis on the company’s AI strategy, the launch of its latest Grok 4.6 model, and a large exodus of short-selling capital earlier. Per data from S3 Partners, as of Wednesday, SpaceX’s short positions accounted for around 11% of its publicly traded shares, down sharply from the 34% peak last week. Ihor Dusaniwsky, managing director of predictive analytics at S3 Partners, noted: “Short-selling funds have run out of ammunition. After all, there is a limit to how much capital can be deployed in a single trade.” As shares rebounded, some short sellers have started covering their positions. Short sellers must repurchase shares they had borrowed and sold to close out their positions, and this buying pressure could further amplify the rally. It is worth noting that, per the company’s prospectus, around 319 million shares are expected to become tradable on August 20, with nearly 700 million shares each facing lock-up expirations in September and October respectively. SPCX may see renewed stock price volatility around those dates.