(Bloomberg) — Cathie Wood’s flagship ETF has been caught in the middle of a push-and-pull, with the latest trading data suggesting bulls are eclipsing bears — at least for now.

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Traders poured almost $294 million into the Ark Innovation exchange-traded fund (ticker ARKK) in the most-recent session for which data is available. The biggest intake since June was enough to erase this year’s withdrawals, with the ETF now posting about $142 million in inflows since the end of December, according to data compiled by Bloomberg.

That’s an astonishing turnaround for a fund that delivered short sellers more money in January alone relative to all of last year. ARKK had the worst monthly selloff in its history on concern that tighter Federal Reserve policy could drag down some the most-expensive and speculative pockets of the market. But after making nearly $1 billion in 2022, traders may be wrapping up their bearish bets and closing positions.

Short interest as a percentage of shares outstanding on ARKK dropped from a record of 10.6% last week to less than 9%, according to data from IHS Markit Ltd. Short closing requires traders to buy back borrowed shares, which can often boost the price of the shorted security.

The ETF climbed 2.2% Tuesday, extending a three-day rally to 16%. Some of its top stocks like electric-car maker Tesla Inc. and remote-conferencing giant Zoom Video Communications Inc. also rebounded in the final days of a very tough January.

“Given the significant decline in many of ARKK’s underlying holdings, it’s certainly possible there’s some short covering going on at the moment,” said Nate Geraci, president of investment-advisory firm The ETF Store. He says traders should still brace for volatility around inflows and outflows going forward.

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Because of the way ARKK trades settle, the flows arrive with a one-day lag.

For Giorgio Caputo, senior fund manager of the JOHCM Global Income Builder fund, ARKK’s recent rally was in part due to the overall risk-on tone in markets after a number of negative trading sessions.

U.S. stocks ended a volatile January with the biggest back-to-back rally since 2020 amid a surge in beaten-down tech shares. The Nasdaq 100 jumped 6.6% in two sessions. Its members took such a walloping for most of the month that the gauge still ended down 8.5%, the biggest tumble since December 2018.

“Some of the sentiment indicators that we track were flashing almost extreme bearishness, and that was particularly true in the technology industry. It’s not unreasonable to see a bounce, whether that’s new buyers or people who are covering their shorts, probably a combination of both,” he said.

Caputo also said that month-end portfolio rebalancing may have added to the dramatic Monday inflow for ARKK.

(Updates prices.)

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