Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Chinese advertising specialist China MediaExpress (Nasdaq: CCME) surged as high as 15% in intraday trading Monday after providing a more detailed response to the swarm of negative reports recently.

So what: In a letter posted on the company's website, CEO Zheng Cheng fervently denied the fraud allegations made by Citron, Bronte, and Muddy Waters, labeling them as "factual inaccuracies" and "misleading innuendo." The shares were beaten down hard after the bearish reports first came out, but Cheng, by calling the short-sellers' objectivity into question, has done well to restore at least some confidence in the stock over the past few days.

Now what: I was a worrywart on Friday when the shares surged, and I feel no differently today. After the quick 15% spike early this morning, the shares have been steadily retreating and are up just 2% at the time of publication. Only time will tell who wins this classic "management versus the shorts" battle, but for most investors, it will remain far too bumpy to bet on.  

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