KOSS stock price slide may continue as the short position reduces

Summary:

The KOSS stock price appears long-forgotten, as the retail crowd shift attention away from KOSS Corp, leaving the stock perilously close to breaking down.

The KOSS stock price appears long-forgotten, as the retail crowd shift attention away from Koss Corp, leaving the stock perilously close to breaking down.

Koss Corporation (KOSS: NASDAQ) finished last week at $21.19, down $0.71 (-3.24%).

The excitement surrounding Koss Corp stock has fizzled out. There was a time when the legacy headphone maker was generating quite a buzz on Reddit’s ‘WallStreetBets’ retail investing forum. However, it’s now nowhere to be seen.

WallstreetBets Sentiment Heatmap:

Furthermore, the short-interest that attracted so many to buy shares in the struggling company has evaporated. This has led to the stock rolling over to a critical support level.

The percentage of shares lent to short-sellers has reduced by 22% and is now just 11.45% of the float. Although still relatively high, there are more appealing options available if you are investing in the hope of a short-squeeze.

Additionally, several recent insider stock sales hardly inspire confidence.

KOSS price forecast

The daily chart shows Koss is now trading below the 50-day moving average at $21.82. Furthermore, on Friday, the price also tested the 100 DMA at $20.91. For now, the longer-dated average is intact, but the momentum looks likely to force Koss Corp below that threshold this week.

In addition, a strong uptrend from January is visible below the price, at $19.20. This provides the last line of defence ahead of a broader decline. Additional targets on the downside are the 11th of May low at $15.57, followed by the 200 DMA at $13.21.

Lower looks favourable from here. However, this bearish view becomes invalid if the price closes higher than the 25th of June high at $26.47.