Does

Intel

(INTC) - Get Report

get squeezed up today? For most of Thursday morning, the chip behemoth's stock was on a tear. It seemed like Intel was benefiting from that rosy PC glow emanating from the

Dell

(DELL) - Get Report

-

IBM

(IBM) - Get Report

deal.

But then, like a ball that looked like it was headed for the fences, the stock stopped short and turned into a virtual can of corn. That 110 touch felt like just another put-out for the chip giant.

The rumors swirled. Conference call after the close: Intel. Negative. And nobody wanted to touch it. Sure enough, after the bell, traders informed us that Intel had called a hasty one. The stock looked doomed.

"Ahh, now I know why this stock got hammered," I thought to myself. "It wasn't the Dell-IBM deal at all. It was a blowup."

But this time it was different. Intel wasn't blowing up at all. It was buying

Level One

(LEVL) - Get Report

in a deal that everybody knows about now. This one was such a closely guarded secret that I saw people shorting Level One all day, in part because it was downgraded that morning by some now goat-of-the-game analyst.

Hedge funds who shorted Intel all day yesterday on rumors of an announcement must now cover, even though the deal, which involves a massive issuance of shares, is not additive. That smells like opportunity, but as I write this, there is none for sale anywhere near where it went out. (For a trade, I believe it works. For a trade.)

That's what a short squeeze always feels like.

Looks like one is in store for Intel today.

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At the time of publication, his fund was not long Intel, though positions may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column by sending a letter to TheStreet.com.