Yesterday, JPMorgan's trading desk finally flipped bearish (having been correctly bullish for the past three months and in direct contradiction to the bank's chief equity strategist, Marko Kolanovic who has been wrong about everything since 2021), and in a note said that a "pullback is coming" then asking rhetorically "what do we do?"
As it turns out, none of this was news to the hedge fund community, who were doing precisely what they should be doing during a market blow off top and ahead of any market pullback - they were selling.
As Goldman Prime's Vincent Lin writes in his "chart of the day" note (available to pro subs), amid increased evidence that positioning is no longer a tailwind to equities per the latest GS Sentiment Indicator (link) "aggregate trading flows on the Prime book suggest hedge funds are starting to position for downside risk in US stocks."
