Short Covering in Sears, Chart Event (SHLD)

Sears Holdings Corporation (NASDAQ: SHLD) is having another big up-day on what appears to be no news.  That implies short covering as the short sellers occasionally have to run for cover.  While fundamentals stink at Sears, this stock has now bounced by more than 50% from its lows.  At 47.65 after a gain of almost 7% so far not even 600,000 shares, the 52-week trading range is $28.89 to $94.79.

We would note that the 50-day moving average was at $44.82.  If today’s gain holds up, this would mark the first successful test and breach of that resistance mark since the breakdown in November. The 200-day moving average does not come into play until north of $62.00. 

Sears is a stock subject to rumor mongering and suppositions almost unlike any other retailer.  It would not even be a shock to hear a rumor that Eddie Lampert bought shares of Facebook as the next rumor (and we HAVE NOT heard that)…

The short interest as of mid-January was huge at 15.4 million shares, up from 14 million at the end of December.  The most recent data showed Sears to have the largest short interest in over a year. 

 JON C. OGG