One possible earnings short-squeeze trade in the biotechnology and drugs complex is Obagi Medical Products ( OMPI), which is set to release numbers on Thursday after the market close. This company develops, markets and sells, and is a provider of, topical aesthetic and therapeutic prescription-strength skin care systems and related products in the physician-dispensed market. Wall Street analysts, on average, expect Obagi Medical Products to report revenue of $30.39 million on earnings of 14 cents per share. The current short interest as a percentage of the float for Obagi Medical Products is notable at 10.4%. That means that out of the 17.66 million shares in the tradable float, 1.89 million shares are sold short by the bears. The short-sellers have also been increasing their bets from the last reporting period by 111%, or by about 993,000 shares. That is a huge increase on a stock with an extremely low float. If Obagi Medical Products can deliver a strong quarter, then this stock will have an excellent chance of seeing a giant short-squeeze. From a technical perspective, OMPI is currently trading above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending very strong for the past six months, with shares soaring from a low of $11.07 to a recent high of $18 a share. During that monster run higher, shares of OMPI have been consistently making higher lows and higher highs, which is bullish technical price action. That said, the stock recently pulled back off that $18 high to right near its 50-day moving average of $14.55 a share. >>5 Biotech Stocks Poised for Breakouts If you're bullish on OMPI, then I would wait until after they report earnings and look for long-biased trades if this stock can manage to hold its trend above its 50-day moving average of $14.55 a share with strong upside volume flows. I would consider any upside volume day that registers near or above its three-month average action of 379,127 shares as bullish. If that trend for OMPI holds post-earnings, then this stock has a great chance of re-testing and possibly taking out its 52-week high of $18 a share. I would avoid OMPI or look for short-biased trades if it fails to hold that trend after it reports, and it then takes out its 50-day at $14.55 with heavy volume. If we see that action, then OMPI could easily trade down toward $13.50 to $12 a share if the bears whack this lower post-earnings.