Short interest in market about to be burned?

This chart courtesy of Zero Hedge:

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It's interesting to note that NSYE short interest is at the highest level it's been since early 2009.

It would seem that expecting stocks to continue their fall is the 'new black'.

While I'm certainly not looking to be long stocks (other than those precious metal related), I think going short into next week where we have an extended FOMC meeting (to discuss use of Fed's tools to assist economic recovery) would be a ballsy move.

It would not surprise me to see a violent rally in the stock market (short term, perhaps next week following statement from Fed) before the downtrend in the stock market continues (medium term).

BB.

 

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