The shares of Consolidation Edison (ED) are currently breaking out from a bull flag pattern on the charts, just above its 200-day moving average and -10% year-to-date level, observes Bernie Schaeffer, technical expert and senior editor at Schaeffer's Investment Research.

The equity has added 5% so far this quarter, and now looks like a prime opportunity to bet on ED’s next leg higher.

Digging deeper, there was a recent 72% surge in short interest during the past two reporting periods, of which, now accounts for nearly 4% of the stock’s total available float. At ED’s average pace of daily trading, it would take short sellers just over a week to buy back their bearish bets.

There is also ample room for upgrades, should the bearish attention being to unwind. This is per the 11 covering analysts that sport a “hold” or “strong sell” recommendation on Consolidation Edison stock.

Lastly, looking toward options, puts rule the roost. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), ED’s 10-day put/call volume ratio of 1.39 sits in the 82nd percentile of its annual range.

Should this bearish sentiment fall off, it could push the security higher. Traders should target a move up to $88, with a stop below $79.

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