SEC has adopted a new short sale regulation (regulation SHO) which will eliminate the uptick and upbid rules ALTOGETHER for 1000 stocks starting (if I remember correctly) next year. This is supposed to be a test program.
They had intended to force the Nasdaq to adopt the uptick rule, but they got a lot of feedback from traders (hedge fund types I would imagine) arguing that the uptick rule is no longer needed.
I suspect things will be more volatile once the new rule goes into effect as program trades will be able to just keep taking out the bids on the stocks no longer subject to uptick/upbid requirements.
Does my current position on INTC change rules governing short sales?
And a couple of corrections: I see now in the final new rule (to which I linked earlier), the pilot program (by which the SEC will attempt to gather data in order to decide how the price test for shorting should be changed or eliminated) will be specified by a separate order from the commission.
Also, the original proposal wasn't that the Nasdaq would be forced to adopt the uptick rule. Rather, the SEC was proposing that ALL stocks (other than ETFs and others with exemptions) would be subject to a new, uniform bid test, which would allow NO SHORTING at the bid at all - shorts could only be executed at least one penny above the best consolidated bid.
THAT was going to make shorting stocks much more difficult than it currently is, so traders were against it. However, specialists at the NYSE and AMEX are against even the pilot test as they are wanting to hold on to their licences to steal. (Specialists and MMs can short without regard to uptick or upbid as long as they are doing so in their market making capacity of keeping the market liquid (yeah, right).)
By all means hold to your ignorance of the subtle differences if you must.
<you can not short a Nasdaq issue while lit is in freefall>
Never said you could, only that you do not need an uptick to short nasdaq stocks. You need an upbid, then you can hit the bid with short sales all you like. I know, I know, it's too subtle for you to comprehend.
You may also want to read www.sec.gov/rules/final/34-50103.pdf as this covers the new rule (not yet in effect).