BUZZ-European stocks: reloading short bets following the squeeze

** Squeeze in heavily shorted names is giving hedge funds chance to revisit bearish bets on certain stocks, two traders say

** Rally across European stocks post-Greek deal lifted all boats including heavily shorted stocks that were squeezed

** Swatch (43 pct utilisation rate per Markit (NasdaqGS: MRKT - news) ) moves from among most oversold in Europe to among most overbought (RSI above 70 for first time since November 2014). Chart: http://link.reuters.com/puw25w

** Stock has bounced 18 pct in 8 trading days since earnings , though rally looks to be running out of steam

** Alfa Laval (Other OTC: ALFVY - news) (30 pct utilisation) up 9 pct following results

** Others moving from oversold to overbought through the rally and having high short interest: Petrofac, Galenica , Elekta (Stockholm: EKTA-B.ST - news) , CNHI, Carillion , Air France (Paris: FR0000031122 - news)

** Average days-to-cover ratio in Europe has moved from around 6 days to 4 days in the last week, according to Citi, suggesting absolute level of outstanding short positions has come off (RM (LSE: RM.L - news) : alasdair.pal.thomsonreuters.com@reuters.net)