These heavily shorted stocks are tanking

It's been a good year for the short sellers.

Amid a flat market, this year's most heavily shorted stocks have plunged. Six of the seven current most popular shorts are down in 2015, some considerably.

Out of the favorite shorts, the big winner (or loser, for those unlucky longs) is Chesapeake Energy, which has lost more than half of its value this year, and is the S&P's third-worst performer. The other biggest 2015 decliners, Consol Energy and Keurig Green Mountain, also have elevated short interest.

These aren't all names that the shorts have recently jumped on, either. While Fossil has seen its short interest double in 2015, Transocean and Chesapeake have been popular shorts all year long.

So has GameStop, a striking example of a company that has managed to rally 33 percent in the face of serious concerns about its business and incredibly bearish market sentiment.

Read More Cramer: I was just plain wrong about GameStop

Rich Ross, technical analyst with Evercore ISI, encourages traders to buy the video game seller now. He explains that GameStop stock is in "outstanding technical position," and "those shorts getting squeezed is providing fuel to that trend."

Shorting a stock is a maneuver by which an investor sells a stock without owning it, forcing that investor to buy it back later. If the stock falls in the intervening time, that investor will pay less than they take in, allowing them to enjoy a profit.

Read MoreStocks are a 'disaster waiting to happen': Stockman

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Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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