What Does Decrease of SHORT Shares Portend??

[jdeo1969]

If the interest rate is going up, that would indicate that there is more demand for shares to short. I am not sure how the technicals work, but large money could very easily work it down 2 bucks from shorting on light volume, then cover more shares at the lower price, which would still amount to a reduction of the short count overall. For the sake of an example, short 500 shares to knock down the price, then buy 1000 shares, thus reducing the short count by 500 shares. Could this be a way the shorts cover without a short squeeze? I have no technical analysis to provide, but I do believe they use shorting to lower the entry point be it for day trading, or for covering, or both.

Good luck longs