Palm Inc. (NASDAQ: PALM) is trading higher this morning but already off the pre-market highs. The troubled smartphone maker was upgraded to Hold from Sell at Morgan Joseph this morning after last week’s sell-off based on valuation. After hitting under $10 briefly on Friday, the firm believes that it is discounting guidance and targets. It also noted that the risk-reward no longer favors the short sellers. At 8:55 AM EST we have shares trading up over 1% at $10.28 on 151,000 shares. There is a monster short interest here in Palm.