Citi’s Chew Sees Aggressive Short-Selling Positions in US Stocks

Traders are aggressively building short-selling positions in US stocks, while bullish wagers on the tech sector remain stretched, putting the market at risk, according to Citigroup Inc. strategists.

Friday’s near 5% selloff in the Nasdaq 100 index, the sharpest in 14 months, has only partially reset exposure among investors, the Citi team led by David Chew said in a note.

“Flows reveal a bifurcated market, with a mix of aggressive short building recently alongside continued legacy longs,” Chew wrote. “Nasdaq bullish positioning remains extended, leaving the overall setup improved but still vulnerable to downside risks.”

Source: Citigroup

Source: Citigroup

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