Not long ago, a nine-game losing streak brought out all of the deficiencies of the Washington Bullets. Coach Gene Shue struggled, seemingly in vain, to keep his team together.

Now, there are a lot of smiles around Capital Centre. The Bullets have won three of their last four games going into tonight's 7:30 contest against the Indiana Pacers at Capital Centre and they are playing a more wide open game that seems to please the players.

Their only loss in the last four games was the 117-115 decision against the Kansas City Kings Wednesday when they blew a 23-point lead and missed 10 of 12 free throws in the fourth quarter.

They rebounded with a 100-93 victory over San Diego Friday night while making 30 of 33 free throws, 15 of 18 in the fourth quarter.

"We're going to be fine," said guard Ricky Sobers.

Going into last night's games, the Bullets had moved within 1 1/2 games of Atlanta and one game of Detroit in the race for the last two playoff spots in the Eastern Conference.

The Bullets lacked versatility before the aquisition of Sobers. Now, with Don Collins back from the injured list and Spencer Haywood starting to come around after an assortment of ailments, the Bullets are in the best shape they have been at any time this season.

Shue has started a different lineup in each of the last four games, depending on the opposition. The approach has worked. He used two small forwards, Charles Davis and Greg Ballard, against Kansas City and got only 30 rebounds, three of them offensive.

With San Diego's tall front line, Shue replaced Davis with Haywood and moved Ballard back to small forward and the team got 50 rebounds, 18 of them offensive. Haywood, who missed the previous two games with the flu, had eight points and eight rebounds in the first quarter Friday.

Shue said he isn't sure who he will start tonight. The return of Collins has given the Bullets the speed they need to run. He had eight points in 10 minutes against the Kings and 16 points and two steals against the Clippers.

The Bullets outscored the Kings, 26-4, on fast break points, and outscored the Clippers, 28-12.

"We can't just run all of the time, but against some teams and in certain situations we can," said Shue.

The return of Collins has also meant limited time for Kevin Grevey. For the first time in a number of seasons, a healthy Grevey didn't get in the game Friday.

Tonight's game will be televised on ESPN . . . This will be the fifth game of a seven-game home stand for the Bullets. They host Boston Tuesday and Houston Friday, break for the all-star game and then have a six-game road trip out west . . . The Bullets are 2-1 against Indiana this season . . . Pacers forward Clark Kellogg is one of the top rookies in the NBA, averaging 20.2 points and 10.2 rebounds.