After last week's huge run in the price of crude oil, it is time to think about taking a short position. This trade worked beautifully back at the beginning of August when crude was trading at similar levels. NYMEX front-month crude futures are now trading at $81.30.

Given the current economic backdrop, $80 seems to be the magic number over which oil has a difficult time sustaining itself. There are a number of important economic numbers out this week, any one of which could send the price of oil back below the $80 threshold. In the short term, a lot of things need to go right for crude to continue to march higher.

Back in February, gold took a big hit when the Federal Reserve announced it was lifting the discount rate. After pushing briefly above $1,200 an ounce at the beginning of December 2009, the safe-haven metal slumped over 12% in two months to a low of around $1,050.

Here we are about three months removed from that low, and we're right back where we started price-wise -- or at least, we were until gold spiraled downward over the last few days to mark a two-week low. So everyone is asking the question, "Is gold going lower, or is it going higher?"

An update on a short position: Radio Shack Corp. (RSH), recommended on August 4, 2009 at a price of $16.13: cover short.

They don't all work out. Further, one of the surest signs that an economic recovery is gaining strength concerns previously fundamentally-supported short recommendations that don't perform.

McDonald's Corp. (MCD): Cover Short. They don't all work out. McDonald's shares, first recommended on June 26, 2009, at a price of $57.00, have broken out of a trading range and recently pierced psychological resistance at $60.

The fast food sector's U.S. fundamentals still don't look that strong, but emerging markets will offset the aforementioned, if the global economy continues to strengthen, as expected.

I'm recommending that traders Cover a Short for Exxon-Mobil (NYSE: XOM), recommended as a Short on June 3, 2009 at a price of $72.09.

Take the minor three points and run. It now appears that Exxon will benefit from several upstream growth opportunities in both oil and liquefied natural gas, and the company's superior technology should result in these projects increasing production quickly and efficiently.

Investor and trader Mishko Janusevich had a mantra that he used to repeat while outlining the top, new stock shorts that appeared that day, as determined by technical indicators.

He would stand next to the overhead projected stock chart at the front of the trading room, point to the stock chart and recite, "You see this stock? You see that it's dropped $8 in past two days? You think it can't drop any more? SELL THAT STOCK it's dropping more!!"

Short these shares if you can tolerate high-risk and are an experienced investor that does not remove Buy/Stop Losses:

These are not the only signs, just a few examples of when to bet against a company, all of which would have worked out great over the past year:

1. Right when management admits a massive fraud over many years, Satyam Computer Services (SAY)

2. Companies lie about the health of management: Apple Inc. (NASDAQ: AAPL)

3. Arrogance and greed blinds management to excessive risk-taking: General Electric Co. (NYSE: GE), Citigroup (NYSE: C), Morgan Stanley (NYSE: MS), Bank of America (NYSE: BAC), General Motors Corp. (NYSE: GM)-pick an over-leveraged financial, any financial...and yes, considering all the messy financial instruments these companies took on, they are all financial stocks.

With turmoil in virtually every equity market, caused by the uncertainty of the world's economies, there was a rush for the exits Tuesday. But negative breadth of 14-to-1 on the New York Stock Exchange -- with just 1.6 billion shares traded -- is usually not the mark of a breakdown but of an emotional selling climax.

Yesterday, the Dow's close came within just 0.31 of the index's lowest close made on Nov. 20 at 7,552.29, with decliners on that day ahead by 15-to-1. Curiously, on that day the Nasdaq recorded breadth of 6-to-1 compared to a negative 5-to-1 yesterday.

TheStreet.com's Jim Cramer says if you're short, you don't want the bill passed. Let's look at that perspective.

First, let's make an important point: Nothing from Congress is going to make this market go up. We need the market go up because it is cheap and it attracts buyers, and because there are companies out there that are worth more than they are trading at -- perhaps as private companies, perhaps as investments right now, if anyone had cash and confidence.

Right now it seems there is neither. All we have are the futures, on stocks and on oil, and they bounce around and we do what they tell us at the start. Then the hedge funds come in and start selling because of their broken models and their redemptions. Then the short-sellers come in and figure out ways to knock down things. Then the rumors start about another bank failure and then we go down.

I want to break that spiral because I own stocks. If I am short stocks, I love the spiral.

Now, the bill in Congress does not break the spiral by any means. What breaks the spiral is a sense that the system is not falling apart, which it most certainly is.

Anything that could help break that spiral is encouraging. Consider that we had the equivalent of Pearl Harbor -- the collapse of so many banks -- and now we need an effective response, which must be massive and persuasive.

Two days before its second-quarter earnings report, lululemon athletica inc. (NASDAQ: LULU) was hit this morning with a steep price-target cut. RBC slashed its price target on LULU from $47 to $30, noting "a 200 basis-point increase in our cost of equity assumption." The analysts tempered their bearish note by reiterating an Outperform rating on the shares.

The brokerage firm's downwardly revised target represents a 64% premium to the stock's closing price Monday. By contrast, the average 12-month price target on LULU is $39.72, according to Thomson Financial. This consensus estimate is 117% higher than yesterday's close, which seems to indicate that further price-target cuts could be in the offing, particularly if second-quarter earnings fail to impress.

During the past four quarters, First Call reports that lululemon has met or exceeded analysts' per-share profit expectations every time. However, it's safe to say that nobody on Wall Street was particularly impressed by LULU's last quarterly earnings report. Since the company announced inline earnings of 12 cents per share on June 2, its shares have shed 43% of their value. Even more compelling, institutional investors have reduced their stake in LULU by a net total of 5% since last quarter.

TheStreet.com's Jim Cramer says struggling banks can be shorted to oblivion now that the rules won't be enforced.

Memo to the FDIC: Watch your back. The SEC just flipped its allegiance to the bad guys, the guys who want to break not just certain banks, but your bank! That's right, with the scrapping of the emergency rule that eliminated naked shorting, where you don't have to find the stock, and with the end of the vigilance against bear raiding, the SEC may have just caused a run at the FDIC.

I had hoped that the SEC would see that these financials have been manipulated to unreasonable levels, making the confidence in all institutions so low that nobody wanted to give them money. The rule change -- which when you think of it, wasn't much of a rule change as much as an enforcement of the way things are supposed to be, where you actually have to find the stock you sold short first so you don't fail to deliver -- worked!

It gave the system some breathing room. I think the rule change might have saved Merrill Lynch (NYSE: MER) (Cramer's Take) from being shorted into oblivion so it couldn't have done its deal. Lehman (NYSE: LEH) (Cramer's Take) didn't do a deal, those bad boys be back on the griddle now for unknown European exposure. AIG (NYSE: AIG) (Cramer's Take) wasn't protected in the first place and I believe will need to raise $10 billion to $15 billion in the teens to cover its European exposure. Now there's little hope at all for Fannie (NYSE: FNM) (Cramer's Take) or Freddie (NYSE: FRE) (Cramer's Take), as their stocks will be blitzed into oblivion and Hank Paulson will have to start the planning of cash infusions as opposed to what he said last Sunday -- why did he say that, for heaven's sake? Maybe he's too close to John "We don't need capital" Thain from their Goldman (NYSE: GS) (Cramer's Take) days.

Fossil, Inc. (NASDAQ: FOSL), the maker of watches and trendy apparel, surprised the Street this morning with stronger-than-expected second-quarter earnings. The retailer multiplied the positive momentum by boosting its full-year forecast. This double dose of good news has sent shares of Fossil more than 8% higher in early-morning trading.

For the recently concluded quarter, net income soared 71% to $25.1 million, or 36 cents per share, while net sales jumped 15% to $353.2 million. The results exceeded Fossil's own forecast, provided in May, for a profit of 29 cents per share on sales growth of 12% to 14%. Analysts had even more modest expectations, with the consensus calling for a profit of 25 cents per share on $346.9 million in revenue.

Digging deeper into the second-quarter figures, gross margin rose from 49.1% to 53.9%, thanks to cost-cutting initiatives and inventory management. Same-store sales climbed 5.7%, while direct-to-consumer sales surged 25%. Domestic watch sales grew by 2.3%, and international wholesale sales rose 20% (or 9.5%, excluding currency fluctuations).

There are many factors that affect oil prices. Fundamental factors such as global supply and demand and dollar moves are often cited. But many also say that traders play a big role in affecting oil prices fluctuations. No doubt, fundamentals are behind oil's long-term uptrend. And it is the dollar's weakness of the past few years that has supported the trend. But short term? Could traders' short covering be the reason behind oil's recent run-up to nearly $150 a barrel?

Perhaps, but that's behind us. Oil prices have retreated more than $20 dollars since. What caused that? Have the fundamentals changed? Some say global demand is bound to slow as the global economy weakens, but others say supply concerns due to geopolitical unrest are also growing. Has the dollar strengthened? A little, but then it declined right back Thursday after a housing report showed recovery is still far off. And what about traders?

Well, here's where The Wall Street Journal as well as Reuters bring an interesting theory. They say that the rise and fall in oil prices coincided with energy company SemGroup L.P.'s (mis)fortunes. SemGroup is a little known private company that transports, stores and distributes crude oil and refined products. It is also the parent of pipeline operator SemGroup Energy Partners L.P. (NADSAQ: SGLP). SemGroup L.P. filed for Chapter 11 bankruptcy protection Tuesday. According to the Journal, "Changes in its hedging strategies coincided with big moves in oil recently."

TheStreet.com's Jim Cramer says we're back in the same predicament, and more bank runs could be the result.

No one did a deal. The financials rallied gigantically, there was tremendous enthusiasm, and yet no bank was ready with an offering. It is amazing, especially when you consider that the natural gas companies, like Chesapeake Energy (NYSE: CHK) (Cramer's Take) and XTO Energy (NYSE: XTO) (Cramer's Take) were ready, despite horrible declines in their stocks.

The moment that Citigroup (NYSE: C) (Cramer's Take) got through $20 or Merrill (NYSE: MER) (Cramer's Take) through $30 or Lehman (NYSE: LEH) (Cramer's Take) through $20, they should have peddled billions more in preferred stock or even common stock.

Just spot 'em right out there. For about a week, people decided the rally could - and would - last if these banks had built up some fortresses. They didn't.

And that's why we are back in the same predicament. I don't want to write here which bank is next to fail. There are enough of them (particularly one that just changed its CEO) that the FDIC will have to have a plan to keep the bad loans and sell the banks, maybe not even with the branches because all that's worth anything is the deposits.

TheStreet.com's Jim Cramer says they're not just the opposite of longs -- they have the power to destroy companies.

Today will be riotously ugly. Today's a day where you could take down a Capital One (NYSE: COF) (Cramer's Take) or a Citigroup (NYSE: C) (Cramer's Take) -- some bad credit card exposure there -- off of American Express (NYSE: AXP) (Cramer's Take). You can bang down Nat City (NYSE: NCC) (Cramer's Take) into oblivionville off of it and hammer Merrill Lynch (NYSE: MER) (Cramer's Take) to the point where you could hear the rumors fly of capital needs. Freddie (NYSE: FRE) (Cramer's Take), merciless Freddie, right at ya. Today's the day when the uptick rule would be the only friend to the notion of owning stocks without fear every minute, fear that they will break your stock. Today's the day that the uptick rule can save Lehman (NYSE: LEH) (Cramer's Take) from $14 or lower. Today's why we need it.

Yet, every time I do a piece that talks about the need to reinstate the uptick rule or enforce the naked short laws, I am immediately greeted with the same nonsense: why should the longs get protection the shorts shouldn't? In fact, other than the usual gang of two -- Patrick Byrne and David Patch -- I don't get any positive feedback on these pieces like the one I did last night on "Mad Money."