I'm no AOL long (closed one losing short position earlier, looking to start a new short position in ~2 weeks), but the shorts should be VERY cautious now.
AOL probably has at least one more big up move before the crash, and this looks to be a bear trap being set to force that move. Puts are too expensive and lots of people are buying. I suspect short interest is up quite a bit as well. Finally, while Soros will evenutally bail, considering his in price, he'll want to drive this up a bit more.