See, I am not loyal to either coin.  I just want to have a decent understanding of possible price changes.

Is my analysis wrong regarding what will happen with short positions?

As another poster mentioned, I think that another force driving the bitcoin price up will be people who are buying in to receive more "free" BCH.

At the time of the fork any one who is short bitcoin on Kraken (and I imagine any other exchange supporting bitcoin cash) will be debited an equal amount of BCH.

example:  margin sell (short) 10 XBT/USD = -10 BCH (short xbt, long usd)

Because of this, there is absolutely no way to break even off of a Bitcoin short, let alone profit.  Essentially, this is going to force everyone who is currently short to close their position, which obviously means they have to buy bitcoin.  All of this demand will almost certainly cause the price to rise, no?

In theory we should be seeing a pretty sizable short squeeze prior to the fork.

Or am I missing something big?

By what logic are people predicting that Bitcoin will take a hit once the fork takes place?  The consensus here seems that most people will simply sell their BCC.  At least some of this money will go into BTC, which would cause the price to increase.

In order for there to be a decrease in BTC people would have to do the opposite.  They'd have to decide to start selling their BTC and go into BCC.

What I'm trying to determine is the following, please tell me what I'm missing:

Kraken is going to be depositing BCC in those accounts that hold BTC or who are long BTC with a margin position.  If someone were to take a margin position for 10 coins (~$27,000) prior to the deadline they would be given a free $27,000 in BCC.

If they sold bitcoin immediately they'd close their position without a gain or loss on the trade, but they'd have that free $27,000.  Even if BCC lost 50% they would end up with a free $13,500.   They'd take the risks that come with margin trades, but they would skip other risks related to having bitcoin on exchanges, etc, etc..   If they just bought BTC without the margin the math would workout the same way.

The only scenario I see for this backfiring is if Bitcoin were to take a major hit, which I think is unlikely due to a few reasons:
1. It's still bitcoin and the true believers are going to fight to keep it strong.
2. At least some of the free money will be going into BTC which should prop it up.
3. At least one exchange, Kraken, will be debiting accounts that are short bitcoin at the fork deadline
   ---- If you're short 1 bitcoin you will have an equal amount deducted from your account as BCC.
  ---This will force all Kraken users to close their shorts, which will essentially amount to a short squeeze.

It seems too good to be true, but I only have a rudimentary grip on this situation so far.  What am I missing?

Im starting to pick up on this.  Almost Every time the price goes up really fast out of nowhere it drops back down with a vengeance.  I have no clue where it's about to go from here, but my money is on it going back down.

Second this.  I'm certainly no pro, but IOTA gives me the same feeling Eth did when I first heard about it just over a year ago.  Unfortunately DAO scared me away from ethereal before it took off.

I'm not in IOTA, but will be watching closely and will likely invest soon.  Kind of hoping it takes a hit and goes back to the teens like it did a week or so ago.

I feel like this is exactly what's going on.  The price is being driven up so that they can pull the floor out on everyone and make bigger money on the short.   Then it'll go back up again.

The thing I'm trying to figure out is why ETH has all of a sudden stopped following BTC.  For the past week at least they've been in lockstep.  ETH did exactly the same thing BTC did.  That stopped today and I think it might support my theory that the efforts are being focused on manipulating BTC.

Based on wishful thinking?  This is all uncharted territory.  What kind of analysis could possibly make you think with any confidence that a spike straight back up is likely?

I think this drop was very fast and there will probably be a good bounce back up just because of trading, but why "300+ soon"?

I am working on getting money into the market.  Will be buying into IOTA sometime after this weekend.  For some reason I'm having the same exact feeling about IOTA that I did with Ethereum exactly one year ago.  I never jumped into ether too heavy because of the DOA and some of the questionable stuff that went on at that time.  Now I'm kicking myself for missing 30x returns.

Fear of missed rewards probably isn't the most sound investing strategy, but I have a good feeling.  I guess we'll see.