Morgan Stanley Says A Massive Short Squeeze Could Be Coming

Markets are approaching extreme levels, observes a trade note from the Morgan Stanley futures desk, and it is hedge funds that have been selling this stock market in a big way and a  massive short squeeze could be approaching. The bank’s futures desk “Pain Trade Monitor,” meanwhile, points to relative value opportunities in derivatives and a potential short term bounce. The issue is: have stocks found at least a temporary bottom?  Massive Short Squeeze? Hedge funds add significant short exposure through futures Behavior at market lows is always interesting, and the February 9 notes that $59 billion of net shorts…