Shorting Explained:
Shorting generally just relates to selling.
Short Sell - Selling at a bid price to lower the stock value
Shorting - Generally selling near or at bid price to lower stock value
Shorting can also mean loaning shares and selling them immediately, the person then (after causing panic and dropping the stock price) buys those same shares back at a cheaper price and gives them back to the broker. He pockets the difference.
Also remember shorting (loaned shares) can only be done with a certain type of account and generally allows loaning, credited or borrowed funds (very risky).
Short Squeeze - This is when someone lowers the price after slapping the bid several times (pays the price to lower the stock value) but something happens and the stock goes up rather than down. Just like when you sell too early and the stock goes up, these guys get trapped under water and they have to quickly buy back their shares at face value. This can be from shorting in general or loan shorting.
Is shorting bad?
The OTC doesnt care for it from what i understand nor does wallstreet in general but its fair play. Most people hate the "loan" shorts because they can be deadly to a stock price as it comes out of the loan and not their own pocket (meaning they can do a lot more damage).
This all of course shouldnt be confused with simple "day trading".
Day trading just means throwing trades back and forth in the same day.
I personally buy and sell a stock as much as i can in order to do whats called "accumulate" shares.
This means I will try to drive the price down, buy, then sell high.
Today you can see this taking place on PGPM as me and a few others are accumulating. This is not bad at all for the stock and is more like a day trader game that is played in between big news or runs. This is infact healthy as people like me or others will have tons of shares in order to help stabilize the stock should it be attacked by a random outsider that is trying to really ruin it via (loaned) shorting for example. Its all about balance and a healthy stock will go up and down while slowly going up overall.
Weak Hands - This is a term people use (though completely inaccurate) for when shorts try to bully the price down and scared "long" people sell in a panic. Its also called "shaking the tree" to scare shares.
This is usually when you see the stock plummet very hard. Its a "shake and bake" tactic done by many. I have done it as well and it does work but its also dangerous depending on the stock. Think of it as a very aggressive version of slow accumulation.
If a stock is slowly "churning" like it is today (tuesday) this means the people (like myself) who are selling and buying to get more shares are playing with caution or playing nicely. This is the healthiest a stock can be when there is no current news. No fear of it losing control and no worry of a massive spikes to cause a "pump". Of course any press announcement can throw this into chaos instantly.
I hope this is a good help to anyone looking for the real deal on how it works with "shorting" and realize most of what you hear on the forums is a myth or technically inaccurate. There is nothing bad about selling or buying. There is no such thing as "weak hands" just people cautious about their money if they are long and others trading daily. There are a few rare people that do play mind games both on the chart and on the forums. Its always best to be logical about anything you read and make sure its backed by a link or data from some other source.
Back to trading i go and happy bidding!
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