CoreWeave inches up to all-time high, boosts corporate miner trend

CoreWeave is closing in on its all-time peak above $160, suggesting its rally goes beyond being a meme stock. The rise of CRWV coincides with a positive month for miner stocks that pivoted to high-density computing for AI. 

CoreWeave (CRWV) is back to expansion mode, leading to expectations of another rally. The AI computation company, which pivoted early from Ethereum mining, was one of the biggest winners during the LLM expansion stage. 

CRWV showed strong bullish momentum in the past month, with periods of trading based on a short squeeze. | Source: Yahoo Finance

CRWV climbed to $158.50, on track to repeat previous records above $161. In the last two weeks, the CRWV rally raised suspicions that the stock was boosted by meme traders . However, the company has tapped demand for high-density computation for AI, and got a boost from Nvidia (NVDA). 

The stock moves on a mix of two major factors—trading based on a potential short squeeze, and general bullish momentum for all AI stocks. 

CoreWeave goes through another record borrowing period

While CRWV is watched for its fundamental potential, in the short term, the price rally coincides with record costs to borrow shares, signaling a short squeeze. 

During the recent price climb to near-peak prices, CRWV borrowing rates also reached new records. As of June 12, the rate increased to 343.1%, then turned down to around 197%, with 200K CRWV shares available to borrow. 

CRWV borrowing rates increased to a record, suggesting a short squeeze is a partial factor for the stock’s rally. | Source: CompaniesMarketcap

The short interest on CRWV moved within a wide range in the past few days, from 32% to as much as 45%. On social media, messages of short interest of up to 65% of the free float also appeared, boosting the FOMO for trading CRWV. 

Short interest is not a guaranteed trend, and can shift on a daily basis. However, CRWV can still trade under conditions similar to a short squeeze, at least in the short term. The shares are closely watched for their month-long bullish trend, which may lead to sharp increases in borrowing costs for covering short positions. 

In June, shares available to borrow increased, potentially easing the borrowing situation, though at a high price. On June 8, only 25K shares were available to borrow, increasing to over 250K at the new record borrowing rates. 

CoreWeave brings attention to mining companies

The success of CoreWeave and demand for computation is boosting the shares of other mining companies. Core Scientific (CORZ) rose by over 12% in the past month. The company may have an ongoing boost from its 12-year deal with CoreWeave, with $4.7B earmarked for data center investments. Core Scientific is also building some of the CoreWeave data centers in Texas, with a goal of tapping 200MW in energy for data centers.

The shares are up by 100% since the lows in April and May. The company mixes ongoing BTC mining with a treasury of 977 BTC, while also making forays into computation services. 

Other companies like CleanSpark and Riot Platforms are still trying to push off their recent lows, with more gradual gains. 

TeraWulf (WULF) had a more dramatic rally, rising from around $3.50 in early June to over $4.33. The company has previously benefitted from its pivot to AI data centers. It also extends the trend of seeking out renewable electricity resources to create sustainable data centers.

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