Here are six stocks with solid chart patterns, improving price momentum and money flow and they have large outstanding short positions. The implication is that if there are bullish chart pattern breakouts, the shorts will be forced to cover their positions. This would initiate short covering rallies in the stocks.
Remember though, often times the shorts are correct in the longer term. So, if you trade this kind of strategy, keep time frames short, and take quick profits or quick losses.
