MastaBeta: I'm not a chart reader (would like to have that skill, but don't have it). But common sense tells me there is an enormous supply of this stock available from institutions and that the rosy glow is permanently off this stock. A rally like you predict could only be fueled by short covering or retail diehards. Perhaps a big part of the increased short position is hedge funds. I suspect most of the posting of shorts here are from those holding puts which is the only way one can short this from many brokerages at this point. I'm suggesting that the put-call indicator in this case may not be so reliable, and that a short cover rally might be very short lived. Some of us with short positions are concerned that if we were to cover, we would have trouble again borrowing the shares to reinstate our position. Everything seems to suggest this stock is going to 12 or less. The institutions can see that too. Any short term bump over 20 may be a last chance for longs to unload and get out with (some) of their capital in tact. In sum, I would suspect a run would peter out before the stock got to 22.
Doesn't common sense also dictate that if there are no shares to short, that there is a distinct possibility that the "forces" are planning on an upward path? Hedgies work both ways and could care less about company "short-term" fundamentals, its all about profit. That's common sense too. If covering makes one concerned that they might not get the opportunity to short shares, my question is why focus on this stock alone. Frankly, there are other stocks, which I will not bore you with, that make fantastic short candidates and "this horse" could turn at any moment. Common Sense would indicate that one should pay attention to the put-call ratio. Even if you don't, surely the pros do. I would not be hard pressed in seeing this go to 26. Lastly, if you and others were so confident that this "pup" was headed south, why not buy puts rather than short the shares. More bang for your buck! This only indicates to me that "confidence is waining" in the short-term for "shorts".