Short interest in Jet Blue fell 12.2 million shares to 39.1 million in December. And, that is after the stock has run from $9.25 to $14.62 in the last three months.

What gives? The industry as a whole is improving with falling fuel prices, higher ticket prices and more customers. And, Jet Blue is being expecially aggressive in capitalizing on the trend. It has added  nearly 15% to the number of seats it has available in Q4 and plans to increase that again by between 11% and 14% next year.

Calyon Securities recently upped Jet Blue from "neutral" to "add" based on the belief that management can return the airline to ongoing profitability.

It looks like the market does not want to bet against that.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.