Earnings season is approaching for consumer cyclical and tech names, with short interest decreasing and stocks rising. Short positions are common in consumer cyclical, a highly shorted sector. Using our Black APP {APPS BLACK<GO>} on the Bloomberg Terminal to analyze your positions for short squeeze risk.

Next week is earnings season for consumer cyclical names.

Half of the earnings names that either have large market caps or large short notional positions are in consumer cyclical.

Consumer cyclical names tend to have high short positions as a percent of float, not because of earnings, but as a structural situation. Consumer cyclical is the second most shorted sector.

The other names are half in Technology.

The market stocks, and sector ETF are all up the past week, with the market at all times high. Short interest as a percent of float is lower the past week indicating bullishness into earnings.

Last time half of the stocks were up, a quarter unchanged and a quarter down.

Three quarters of the stocks had their short interest go down after earnings representing bullishness.

Those stocks up were more likely to have their short interest go down.

As earnings season kicks off for consumer cyclical and tech stocks, short interest is decreasing, and stocks are rising, indicating potential bullish sentiment. With key reports expected next week, investors should keep an eye on post-earnings short interest changes, which have historically signaled market direction. Stay tuned for deeper insights and trends as more earnings reports are released next week.

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