Marko Kolanovic: 1. bank stocks positioning to break out from their two-month trading range. Multiple upcoming catalysts could solidify and accelerate this breakout

2. Many stars aligned: Value buyers, short coverings, and improving fundamentals (e.g., steepening yield curve, environment benefitting trading/banking, resiliency of the consumer,…[Read more]

1. Goldman Sachs prime brokerage data from Friday showed that net leverage now is at the highest level in more than 2 years.

2. Gross leverage rose to 249.6% (99th percentile).

3. add to this CITI Euphoria data, various recent sentiment indicators as well as RobinHood anecdotal behavior and is it starting to get interesting

$SPX tactical issues near-term:

1. Gold steady above 1,700
2. Crude possibly top-ping
3. Demark sell signal
4. SPX stocks above 50-DMA 99%ile
5. Macro tensions rise
6. Month-end rebal
7. Rising NDX short interest
8. Defensive rotation (XLP higher lows)
10 MOC sell 2.7bn Thurs

Marko Kolanovic, who was one of the absolute first sell-side strategists to turn bullish, is now “dialing down” his positive outlook, based on two risks:

1. paralysis and delays in reopening the US economy

2. geopolitical tensions that could cripple the recovery of global trade

“As the market staged a substantial rally (nearly ~40%) since our…[Read more]

Positioning is extremely light
1. institutional investor positioning still appears very light. Systematic strategies have only been modest buyers and leverage remains near the lows – and likely remains there in the near-term as volatility remains high. Futures positioning remains very light and most shorts have not been covered.

2. US L/S HF n…[Read more]

Goldman Sachs: HFs finally buying en masse, as per latest GS PB data.

1. Net Leverage rose +3.8% – the largest increase in eight weeks

2. Net Leverage now 73% (91st percentile one-year).

3. All regions were net bought on the week, led in $ terms by North America and Europe.

4. Industrials saw the largest net buying in more than two years