Like a thief in the night, holders of Sirius XM short positions are scrambling to cover. According to Satwaves.com, Sirius XM short interest has fallen 32.69% from 310,672,182 shares to 209,124,306 in only a 2 week period; a decrease of 101,547,876 shares.

A check of the NASDAQ market site verifies this information which brings the number of Sirius XM shares short to nearly the levels of the pre-merged stand-alone company. It would seem that the shorts are taking advantage of a suppressed stock price to cover, as the "upside" potential of a short position in Sirius XM has seemingly diminished.

With the knowledge of the recent loan of 168 million shares to short against the convertibles, it would seem that few true shorts remain.  A recent Reuters report on overall short interest indicates "that investors may think the worst of the market downturn may be over."

With over 200 million short shares remaining, those that continue to hold positions short may find themselves at the losing end of any good news reports going forward, as very few others will be there to support their positions and risk fighting renewed strength from the buy side of the ledger.

Position: Long SIRI