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Two very helpful sentiment indicators are the put/call ratio and the number of shares shorted. Whenever the put/call ratio of a company falls or the number of shares shorted decreases, it indicates a bullish change in sentiment.

We ran a screen on stocks rallying above their 20-day, 50-day, and 200-day moving averages for those seeing bullish changes in sentiment – significant decreases in shares shorted month-over-month, and significant decreases in the put/call ratio over the last ten trading days.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.


We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

click on image to enlarge

Do you think options traders and short sellers are calling it right on these names? Use this list as a starting-off point for your own analysis.

List sorted by decrease in put/call ratio.

1. National Semiconductor Corporation (NSM): Semiconductor Line Industry. Market cap of $6.28 billion. The stock is trading 0.30% above its 20-day SMA, 0.36% above its 50-day SMA, and 30.65% above its 200-day SMA. Shares shorted have decreased from 4.25 million to 3.70 million month-over-month, a change representing 0.22% of the company's 245.37 million share float. Put/call ratio has decreased 83.22% over the last ten trading days (from 3.04 to 0.51). The stock has gained 95.81% over the last year.

2. Pharmaceutical Product Development Inc. (PPDI): Medical Laboratories & Research Industry. Market cap of $3.59 billion. The stock is trading 14.45% above its 20-day SMA, 17.96% above its 50-day SMA, and 17.37% above its 200-day SMA. Shares shorted have decreased from 4.13 million to 2.52 million month-over-month, a change representing 1.57% of the company's 102.54 million share float. Put/call ratio has decreased 76.40% over the last ten trading days (from 0.89 to 0.21). The stock has had a couple of great days, gaining 27.57% over the last week.

3. Sun Communities Inc. (SUI): REIT Industry. Market cap of $794.86 million. The stock is trading 1.59% above its 20-day SMA, 0.99% above its 50-day SMA, and 8.24% above its 200-day SMA. Shares shorted have decreased from 1.16 million to 1.08 million month-over-month, a change representing 0.43% of the company's 18.72 million share float. Put/call ratio has decreased 61.90% over the last ten trading days (from 0.21 to 0.08). The stock is a short squeeze candidate, with a short float at 5.52% (equivalent to 8.55 days of average volume). The stock has had a couple of great days, gaining 18.65% over the last week.

4. Federal Realty Investment Trust (FRT): REIT Industry. Market cap of $5.48 billion. The stock is trading 1.05% above its 20-day SMA, 1.14% above its 50-day SMA, and 6.43% above its 200-day SMA. Shares shorted have decreased from 4.36 million to 4.07 million month-over-month, a change representing 0.47% of the company's 62.20 million share float. Put/call ratio has decreased 37.88% over the last ten trading days (from 1.32 to 0.82). The stock is a short squeeze candidate, with a short float at 6.58% (equivalent to 7.14 days of average volume). The stock has had a couple of great days, gaining 15.85% over the last week.

5. Extra Space Storage Inc. (EXR): REIT Industry. Market cap of $1.99 billion. The stock is trading 0.86% above its 20-day SMA, 0.56% above its 50-day SMA, and 8.90% above its 200-day SMA. Shares shorted have decreased from 5.71 million to 5.31 million month-over-month, a change representing 0.46% of the company's 86.80 million share float. Put/call ratio has decreased 18.18% over the last ten trading days (from 1.21 to 0.99). The stock is a short squeeze candidate, with a short float at 6.13% (equivalent to 5.9 days of average volume). The stock has had a couple of great days, gaining 18.44% over the last week.

6. NetEase.com, Inc. (NTES): Internet Software & Services Industry. Market cap of $6.52 billion. The stock is trading 1.41% above its 20-day SMA, 5.57% above its 50-day SMA, and 10.23% above its 200-day SMA. Shares shorted have decreased from 2.08 million to 1.93 million month-over-month, a change representing 0.21% of the company's 72.14 million share float. Put/call ratio has decreased 13.04% over the last ten trading days (from 0.69 to 0.6). The stock has had a couple of great days, gaining 20.74% over the last week.

7. Essex Property Trust Inc. (ESS): REIT Industry. Market cap of $4.75 billion. The stock is trading 2.13% above its 20-day SMA, 2.58% above its 50-day SMA, and 14.36% above its 200-day SMA. Shares shorted have decreased from 2.25 million to 2.08 million month-over-month, a change representing 0.53% of the company's 32.21 million share float. Put/call ratio has decreased 9.90% over the last ten trading days (from 1.01 to 0.91). The stock is a short squeeze candidate, with a short float at 6.35% (equivalent to 6.64 days of average volume). The stock has had a couple of great days, gaining 16.24% over the last week.

8. Domino's Pizza, Inc. (DPZ): Restaurants Industry. Market cap of $1.57 billion. The stock is trading 0.47% above its 20-day SMA, 3.15% above its 50-day SMA, and 33.22% above its 200-day SMA. Shares shorted have decreased from 3.15 million to 3.00 million month-over-month, a change representing 0.37% of the company's 41.04 million share float. Put/call ratio has decreased 8.33% over the last ten trading days (from 0.24 to 0.22). The stock has had a couple of great days, gaining 11.7% over the last week.

9. Fidelity National Financial, Inc. (FNF): Surety & Title Insurance Industry. Market cap of $3.64 billion. The stock is trading 1.58% above its 20-day SMA, 3.45% above its 50-day SMA, and 12.30% above its 200-day SMA. Shares shorted have decreased from 12.56 million to 10.87 million month-over-month, a change representing 0.81% of the company's 208.42 million share float. Put/call ratio has decreased 6.87% over the last ten trading days (from 4.51 to 4.2). The stock has had a couple of great days, gaining 10.76% over the last week.

*Short data sourced from Yahoo Finance, options data sourced from Schaeffer’s, all other data sourced from Finviz.

Source: 9 Rallying Stocks With Bullish Options Sentiment and Short Trends