TSLS Short Interest Drops 53.3%: Direxion Daily TSLA Bear 1X Shares Update
TSLS short interest plunged 53.3% to 1,569,001 shares by Dec 31. Discover what the Direxion Daily TSLA Bear 1X Shares decline means for market sentiment & risk.
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Direxion Daily TSLA Bear 1X Shares (NASDAQ:TSLS) experienced a marked decline in short interest during December, signaling a shift in investor positioning around this inverse Tesla exposure. As of December 31, short interest stood at 1,569,001 shares, a 53.3% decrease from the December 15 total of 3,356,860 shares.
This substantial reduction in short interest for TSLS reflects changing market dynamics. Short interest is a key indicator of bearish convictions and potential short squeeze risk. A halving of the short base in a two-week span can indicate traders covering positions, reduced bearish sentiment, or reallocations as market participants respond to price moves and news affecting Tesla and related ETFs.
For traders and investors, the TSLS short interest drop has several implications. First, lower short interest generally reduces the immediate risk of a short squeeze, which occurs when rapid buying forces short sellers to close positions at a loss. Second, it may mean fewer active bearish bets on Tesla via this bear ETF, potentially reflecting increased confidence in Tesla’s near-term outlook or a shift to other hedging tools.
It’s important to interpret these changes alongside trading volume, price action, and broader market sentiment. Short interest is one metric among many: average daily trading volume and open interest in related derivatives can change the picture. Investors should also remember that TSLS is a daily inverse ETF designed for short-term trading, not long-term investment, and is sensitive to daily compounding and volatility.
What should investors watch next? Monitor ongoing short interest reports, NASDAQ filings, and volume trends for TSLS. Keep an eye on Tesla company news, earnings, and sector momentum, as those factors directly influence demand for inverse exposures. Risk management matters: set clear entry and exit plans, use position sizing, and consider alternatives if your goal is long-term hedging rather than short-term trading.
In summary, the sharp 53.3% decline in TSLS short interest to 1,569,001 shares by December 31 highlights a notable rebalancing among bearish traders. Whether this change presages a longer-term shift in sentiment or simply a temporary adjustment will depend on upcoming market developments and Tesla-related catalysts.
Published on: January 17, 2026, 2:05 pm
