Well I am not sure about the unwinding short position, etc. But you saw yesterday a classic case of the shorts fighting hard to close below 7.50. They knew that was a psychological price and the weak hands would be even more nervous. So this morning all they needed was a little push and down we went.
But the good thing is that the 7.14 resistance held. Besides, as others have said, you can't get caught up in the day to day gyrations. The numbers for this company are still excellent. As long as those monthly op stats keep coming in like they have all year there is no reason to believe that over the long term this stock will continue higher.
IMO, just as we saw earlier this year when the stock got range bound in the 5.5-6.5 area, I think it will be range bound in the low 7 to low 8 area for awhile. Get a boost with Q3 earnings and than the big boost when the CW agreement is announced. If all that plays out, we should see 10 by the end of the year and be set up for an excellent run in 2014.