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Shares shorted are a clear indicator of short-sellers’ sentiment on a stock. Because short-selling is a bearish position, increases in shares shorted is a bearish change in outlook.

We ran a screen on stocks with bullish sentiment from short-sellers. We began by screening for technically oversold stocks (with RSI (14) below 40). We then screened for stocks with bullish changes in shares shorted, with significant decreases month-over-month.

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.)

Do you think the short-sellers are calling it right? Use this list as a starting point for your own analysis.

List sorted by decrease in shares shorted as a percent of share float.

1. Eastman Kodak Co. (EK): Provides imaging technology products and services to the photographic and graphic communications markets worldwide. Market cap of $275.35M. RSI(14) at 39.90. Shares shorted have decreased to 62.29M from 68.12M month-over-month, a change representing 2.17% of the company's 268.86M share float. The stock is a short squeeze candidate, with a short float at 25.32% (equivalent to 5.47 days of average volume). It's been a rough couple of days for the stock, losing 7.27% over the last week.

2. OmniVision Technologies Inc. (NASDAQ:OVTI): Designs, develops, and markets semiconductor image-sensor devices. Market cap of $693.26M. RSI(14) at 39.47. Shares shorted have decreased to 5.56M from 6.62M month-over-month, a change representing 1.90% of the company's 55.78M share float. The stock is currently stuck in a downtrend, trading 9.05% below its SMA20, 21.1% below its SMA50, and 55.05% below its SMA200. The stock has had a couple of great days, gaining 11.72% over the last week.

3. Quality Systems Inc. (NASDAQ:QSII): Develop and market health-care information systems. Market cap of $2.09B. RSI(14) at 39.46. Shares shorted have decreased to 6.12M from 7.60M month-over-month, a change representing 3.76% of the company's 39.34M share float. The stock is a short squeeze candidate, with a short float at 15.56% (equivalent to 8.66 days of average volume). The stock has gained 9.01% over the last year.

4. Kohl's Corp. (NYSE:KSS): Operates department stores in the United States. Market cap of $13.61B. RSI(14) at 39.13. Shares shorted have decreased to 11.17M from 14.22M month-over-month, a change representing 1.24% of the company's 246.31M share float. Might be undervalued at current levels, with a PEG ratio at 0.87, and P/FCF ratio at 14. The stock has lost 6.79% over the last year.

5. NuVasive, Inc. (NASDAQ:NUVA): Engages in the design, development, and marketing of minimally disruptive surgical products and procedures for the spine. Market cap of $541.94M. RSI(14) at 38.33. Shares shorted have decreased to 2.90M from 3.54M month-over-month, a change representing 1.52% of the company's 42.06M share float. The stock is currently stuck in a downtrend, trading 8.66% below its SMA20, 19.46% below its SMA50, and 48.75% below its SMA200. The stock has performed poorly over the last month, losing 11.09%.

6. Encore Capital Group, Inc. (NASDAQ:ECPG): Engages in consumer debt buying and recovery business. Market cap of $509.60M. RSI(14) at 38.25. Shares shorted have decreased to 1.02M from 1.53M month-over-month, a change representing 4.14% of the company's 12.33M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 2.2). The stock is currently stuck in a downtrend, trading 6.97% below its SMA20, 12.81% below its SMA50, and 20.06% below its SMA200. The stock has performed poorly over the last month, losing 20.31%.

7. STEC, Inc. (NASDAQ:STEC): Designs, manufactures, and markets enterprise-class flash solid-state drives (SSDs) for use in high-performance storage and server systems. Market cap of $415.47M. RSI(14) at 37.26. Shares shorted have decreased to 9.30M from 9.74M month-over-month, a change representing 1.27% of the company's 34.66M share float. The stock is a short squeeze candidate, with a short float at 26.05% (equivalent to 6.71 days of average volume). The stock has performed poorly over the last month, losing 19.8%.

8. Biolase Technology, Inc. (BLTI): Develops, manufactures, and markets lasers and related products focused on technologies for improved applications and procedures in dentistry and medicine. Market cap of $82.95M. RSI(14) at 37.24. Shares shorted have decreased to 6.01M from 6.52M month-over-month, a change representing 1.86% of the company's 27.47M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 2.84). The stock is a short squeeze candidate, with a short float at 22.93% (equivalent to 22.98 days of average volume). The stock has performed poorly over the last month, losing 27.15%.

9. Perry Ellis International Inc. (NASDAQ:PERY): Engages in designing, sourcing, marketing, and licensing apparel products for men and women in the United States and internationally. Market cap of $246.71M. RSI(14) at 37.23. Shares shorted have decreased to 1.66M from 1.85M month-over-month, a change representing 1.80% of the company's 10.54M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 2.28). The stock is a short squeeze candidate, with a short float at 11.72% (equivalent to 6.14 days of average volume). The stock has had a couple of great days, gaining 14.68% over the last week.

10. The Active Network, Inc. (NYSE:ACTV): Offers application services technology and marketing access to community service and participatory sports organizations. Market cap of $678.25M. RSI(14) at 36.90. Shares shorted have decreased to 1.10M from 1.70M month-over-month, a change representing 2.54% of the company's 23.60M share float. The stock is currently stuck in a downtrend, trading 8.53% below its SMA20, 11.77% below its SMA50, and 22.08% below its SMA200.

11. Sequans Communications S.A. (NYSE:SQNS): Designs, develops, and supplies 4G semiconductor solutions for wireless broadband applications. Market cap of $141.99M. RSI(14) at 35.26. Shares shorted have decreased to 867.54K from 1.14M month-over-month, a change representing 1.62% of the company's 16.79M share float. The stock is currently stuck in a downtrend, trading 13.52% below its SMA20, 17.79% below its SMA50, and 52.76% below its SMA200. The stock has performed poorly over the last month, losing 18.39%.

12. Career Education Corp. (NASDAQ:CECO): Provides educational services primarily in the United States. Market cap of $558.26M. RSI(14) at 34.90. Shares shorted have decreased to 4.09M from 9.29M month-over-month, a change representing 9.88% of the company's 52.61M share float. The stock has had a couple of great days, gaining 6.51% over the last week. The stock has performed poorly over the last month, losing 11.54%.

13. Digital River Inc. (NASDAQ:DRIV): Provides outsourced e-commerce solutions worldwide. Market cap of $576.16M. RSI(14) at 34.01. Shares shorted have decreased to 3.47M from 3.92M month-over-month, a change representing 1.25% of the company's 35.93M share float. The stock is currently stuck in a downtrend, trading 7.32% below its SMA20, 19.72% below its SMA50, and 43.68% below its SMA200. The stock has performed poorly over the last month, losing 13.31%.

14. MakeMyTrip Limited (NASDAQ:MMYT): Provides travel products and solutions in India and the United States. Market cap of $867.08M. RSI(14) at 30.99. Shares shorted have decreased to 1.67M from 1.83M month-over-month, a change representing 1.92% of the company's 8.33M share float. The stock is a short squeeze candidate, with a short float at 5.49% (equivalent to 14.19 days of average volume). The stock is currently stuck in a downtrend, trading 14.62% below its SMA20, 11.99% below its SMA50, and 6.82% below its SMA200. It's been a rough couple of days for the stock, losing 7.07% over the last week.

15. Rovi Corporation (NASDAQ:ROVI): Provides digital entertainment technology solutions for the discovery and management of entertainment content. Market cap of $3.0B. RSI(14) at 30.80. Shares shorted have decreased to 5.48M from 8.13M month-over-month, a change representing 2.42% of the company's 109.66M share float. The stock is currently stuck in a downtrend, trading 14.57% below its SMA20, 33.07% below its SMA50, and 45.06% below its SMA200. The stock has performed poorly over the last month, losing 42.28%.

16. Horizon Pharma, Inc. (NASDAQ:HZNP): Develops and commercializes medicines for the treatment of arthritis, pain, and inflammatory diseases. Market cap of $98.82M. RSI(14) at 27.99. Shares shorted have decreased to 192.49K from 198.99K month-over-month, a change representing 3.10% of the company's 209.54K share float. The stock is currently stuck in a downtrend, trading 32.28% below its SMA20, 28.41% below its SMA50, and 33.74% below its SMA200. It's been a rough couple of days for the stock, losing 25.7% over the last week.

17. RPX Corporation (NASDAQ:RPXC): Provides patent risk management solutions in the United States, Europe, and Asia. Market cap of $655.53M. RSI(14) at 27.95. Shares shorted have decreased to 606.12K from 806.61K month-over-month, a change representing 1.28% of the company's 15.62M share float. The stock is currently stuck in a downtrend, trading 8.91% below its SMA20, 22.17% below its SMA50, and 42.18% below its SMA200. It's been a rough couple of days for the stock, losing 8.17% over the last week.

18. Meru Networks, Inc. (NASDAQ:MERU): Engages in the development and marketing of a virtualized wireless LAN solution. Market cap of $72.74M. RSI(14) at 23.47. Shares shorted have decreased to 3.12M from 3.23M month-over-month, a change representing 1.20% of the company's 9.15M share float. The stock is a short squeeze candidate, with a short float at 21.24% (equivalent to 21.95 days of average volume). The stock is currently stuck in a downtrend, trading 17.97% below its SMA20, 33.51% below its SMA50, and 67.21% below its SMA200. It's been a rough couple of days for the stock, losing 10% over the last week.

Short data sourced from Yahoo Finance; all other data sourced from Finviz.

Source: 18 Oversold Stocks With Bullish Short Trends