Wall Street has a product for every mood. For those feeling bearish the solution is to sell stocks short. Making money on a stock’s demise may not be the American way, but the approach can result in big profits for those willing to bet on failure.

Some big names with heavy short interest include Research In Motion (NASDAQ: RIMM), Netflix (NASDAQ: NFLX), Green Mountain Coffee Roasters (NASDAQ: GMCR), and Chipotle Mexican Grill (NYSE: CMG). All of these stocks have more than 10% of their shares outstanding on loan for the purpose of selling short.

On the craps table in Las Vegas they call that betting on the “don’t pass” line.

When the strategy goes viral a stock can become heavily shorted. Because of the unlimited losses that can occur to a short position when stock prices rise, a short squeeze can occur. Shorts that are forced to buy to cover will often add fuel to the fire of a bullish move.

This was demonstrated earlier this year as Travelzoo (NASDAQ: TZOO) exploded higher. At the end of March the company had a short interest that exceeded 35%. When the company reported results that were not as bad as expected the stock jumped. Over a two month period the stock nearly tripled in value.

The contrarian play then is to identify stocks with large short interests. Any catalyst that sends shares higher could result in a subsequent short squeeze. Here are three names to consider today:

Research In Motion

The bears are crushing the maker of Blackberry devices. The smart phone revolution has brought on intense competition for hand held computing and telecommunication. Slow to react to the competition RIMM has lost its leadership role.

When the shorts sensed blood in the street selling intensified. Recently the stock was down some 20% after the company provided guidance that was less than stellar.

Indeed RIMM has issues, but the company is not dead. They have a loyal customer base and they are making money. At current prices RIMM trades for an absurdly low five times current year earnings estimates. One little spark and this stock could explode higher.

Seattle Genetics (NASDAQ: SGEN)

It is easy to be pessimistic with respect to research and development companies. In the drug space companies are valued based on pure hope that a particular drug or treatment will be allowed to come to market. Bulls bet on these companies because once a drug does come to market, monopolistic pricing into monster markets generate big profits.

The flip side is that there is a huge expense and long wait before the ultimate payoff. Shorts can fill that void by speculating on failure. In the case of Seattle Genetics the shorts are experiencing the nightmare of being on the wrong side of a trade.

Shares of Seattle Genetics have gained some 40% since the end of April, a time when the rest of the market was taking a breather. With the company set to bring products to market investors are bidding up shares. The shorts still don’t believe as short interest sits at 25% of shares outstanding as of the middle of June.

When the last of these diehard naysayers buy to cover, this stock could double in value.

ATP Oil & Gas (NASDAQ: ATPG)

Last summer’s British Petroleum (NYSE: BP) oil spill in the Gulf of Mexico provided plenty of fodder for those that love to short stocks. With cameras showing the damage daily, future drilling offshore in the Gulf or anywhere for that matter was in jeopardy.

Stocks sensitive to the issue, including ATP Oil and Gas, capitulated. It was an easy target. The trade worked early, but then the crisis was solved. The shorts went away once the damage was done and moved on to their next target, right?

That would be wrong. Now a year later, short interest in ATPG is at a record high 45% of shares outstanding. The pessimism remains despite oil prices that have shot through the rough during the last 12 months.

Indeed ATPG is losing money, but analysts expect profits to return in 2012. The average Wall Street estimate for fiscal year 2012 ending December 31, 2012 is $2.03 per share. At its current price ATP trades for just 7.5 times the 2012 estimated earnings.

If oil prices continue their ascent, look for a huge short squeeze in ATP