Unfortunately, every bank is different. It's likely the folks in loss mitigation are experiencing a quadrupled workload, and are simply backed up.
Hopefully, your agent is (politely) calling the negotiator daily for a possible update on paperwork. I would suggest the agent propose the neg. email the paperwork versus fax. Sometimes the larger companies have a history of "losing" faxed documents...
Best of luck, and if you're getting a good deal on the property, try and wait it out, it will be worth it. Both agents have probably worked on the deal for many hours, and want the deal to go through just as badly as you do.
Perhaps you can look at houses that are either REO (bank owned) or even a 'regular - not short sale or notice of default' house that slightly above your price range. . Both can close much faster than short sale. This is a great time to negotiate. You will never know what the bank or the regular owner will accept in this market.
Vassi is right - make sure you officially cancel the contract if you want to move on.
But who knows, maybe you will hear something on Monday.
I would go ahead and continue to look for other properties while this is still going on.
If it comes through and you still want the property , great. If not, and if you are protected by a short sale addendum saying that the contract is really not in place unless there is a lender written approval by a prescribed time frame and the lender approved within that certain time period (which does not seem possible from what I read), then you should be able to cancel the contract and go on with the new house you found.
Either way, read your contract carefully to make sure you can get out without losing anything before procedding - eveything is in the fine print. .