Lucid Group Inc (NASDAQ: LCID) saw its stock surge 6.71% intraday on Wednesday, defying a bearish outlook as traders positioned themselves ahead of the Federal Reserve's interest rate decision.
The rally is attributed to technical factors, including high short interest (52.70%) in the stock, which has led to a potential short squeeze. Short sellers may be covering their positions to reduce risk before the Fed announcement, fueling the upward movement.
Analysts note that the broader market has priced in a 25-basis-point rate cut, but the focus remains on the Fed's updated "dot plot" and Chair Jerome Powell's tone, which could impact volatile stocks like Lucid.
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