The end of the holiday week encountered volatility, with the major U.S. indices suffering conspicuous declines. In turn, the cryptocurrency ecosystem was muted, extending a soft spell that began around a week-and-a-half ago. Unfortunately for investors of crypto miners like MARA Holdings (NASDAQ:MARA), the downturn also impacted the business end of the blockchain. However, contrary to popular belief, speculators should consider refraining from buying the dip.
Of course, the temptation is understandable. At the beginning of this week, Benzinga’s unusual options activity screener identified a substantial volume of bearish activity against MARA stock. Specifically, the biggest transaction among the whales — or institutional investors — was for $8 put options expiring Jan. 16, 2026. That implies about a 57% implosion from the time-of-writing price.
Still, as the meme-stock phenomenon demonstrated, contrarian speculation can sometimes lead to big rewards. Fueling this sentiment is the fact that, at the moment, MARA stock represents one of the largest increases in short interest. Currently, MARA’s short interest stands at 25.12%, whereas the prior reading sat at 20.98%.
By aggressively piling into the long side, the contrarian bulls could theoretically panic out the bears. Structurally, in order to close out a short position, the bearish trader must execute a counterbalancing long transaction. Logically, a panicked rush of long volume could skyrocket the target security, leading to a bonanza.
Nevertheless, the empirical data doesn’t support this approach for MARA stock.
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