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Let's look at some numbers in stock ownership of Sears Holdings (SHLD)..
ESL Investments, Inc.= 65.6 million
Legg Mason Capital Management, Inc.= 12.5 million
Fairholme (Bruce Berkowitz)= 12.3 million
Pershing Square Capital Management, L.P.= 6.7 million
Total= 97.1 million shares or 77% of the total outstanding

As of 8/15, 33 million shares were short.
So, Sears has 126 million shares outstanding as of 8/2, 97.1 owned by people famous for long holding periods, and 33 million short.
By now you are saying, those numbers do not add up. I know. Is SEC commissioner Chris Cox concerned about naked shorting in Sears shares? Apparently not because, if the above 4 decide not to sell, there are not enough shares outstanding for the shorts to cover (the above number of shareholders does not include any other owners of sears shares, only those four).
That is the reason the price is up today. Shorts thought about another earnings loss, did not get it and realize Sears will be ok. They probably can do the above math also. So, many have made their money and now are buying to cover, 3.8 million shares traded today at 2:30 vs a daily average of 3.5 million on a VERY slow trading day.