Large speculators (read - hedge funds or the supposed "smart money") have shifted their S&P 500 positioning to net short, increased their Russell 2000 short positioning and decreased their NASDAQ longs to one-year lows. Market-neutral funds have dropped exposure notably in the last week and long/short funds are well below market norms for their long positioning. But what has the bond bears really scratching their heads (as they added to their shorts in the last week) is that the last time so many people were convinced that rates can only go higher (based on CFTC data), bad things happened in stocks.
The smart money is the shortest it has been in the last few years... and is down 1.15% in 2014 (hedge funds).
Smart money is short and getting shorter...
[6]
And the flow is one way...
[7]
But bond bears keep adding to their shorts...
[8]
Which didn't end so well last time for stocks.
So in summary - Hedge funds are selling (and most short in years), smart money traders are selling, retail (who was buying until recently) has been selling recently (as we noted here)... [9] so who is buying?