Cracker Barrel enters its first earnings report since the logo backlash with falling prices, elevated short interest - creating a pivotal setup for traders.

Positioning Analysis

Short Interest at 25% of Float:

Short interest has climbed to 5.5M shares, up 115% year-to-date. This represents 25% of the float, the highest level in over a year, and signals extreme bearish sentiment heading into earnings.

Long-to-Short Ratio Decline:

Active Long Interest notional of $391M vs short interest notional of $284M puts the LTS Ratio at 1.38, firmly in Battleground Stock territory as rising short interest narrows the gap. Longs still outweigh shorts, but conviction is tightening as bearish positioning builds. For context, the LTS Ratio was 2.2 at the start of 2025, when active long interest more than doubled short interest.

Squeeze Potential:

Elevated short interest heading into earnings could set the stage for a potential covering rally, to lock in any recent gains for the fresher bearish positions.

Technical Analysis

Downside Momentum:

Price sits at $51.21, below both the 50-day ($59.71) and 200-day ($53.37) moving averages, which signals persistent downside pressure into earnings.

RSI Near Oversold:

RSI at 40.1 suggests momentum is weak, but not yet deeply oversold, leaving potential for a reversal if earnings surprise positively.

MACD Bearish: Both MACD and signal lines remain negative, confirming downside momentum into the earnings catalyst.

Next Move

Today’s earnings will determine whether the recent heavy short positioning pays off or sparks a covering rally, resetting sentiment in either direction.

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