China MediaExpress Holdings, Inc. (fka CCME)

[Headley Lamar]

The whole "volume was high starting the 15th" argument really doesn't hold much water. The price was burgeoning on the 13th and 14th and volume for those days was c. 2 million and 1.5 million, respectively. However, we now know that those 3.5 million shares traded were not shorts covering. Why should we believe they were covering the following 3 days? Especially when the price was moving down on 16th and 17th.

I think it is more likely that many of the shorts are holding on praying that the stock will lose its momentum, despite good news, and languish back down to single digits as it has in the past. I would not be surprised to find that the current short numbers are even higher now from people shorting in the high $15s and low $16s. Doubling down so to speak.

I also believe that the shorts are fatally wrong in their predictions. The die has been cast for a new CCME with revitalized respect and that is poised to trade like its peers and then above them, and time will surely tell. I have to say that I like our odds with earnings right around the corner :)