First Sentiment Shift Of 2023: S&P Breakout Sparks FOMO Frenzy, Hedge Fund Buying

Are stock market technicals finally shifting? After nearly five full months of relentless permagloom and doom across Wall Street, which was behind our frequent warning to beware brutal, face-ripping short squeezes, and with the S&P breaking out above its 2023 highs, it appears that sentiment is finally shifting:

According to Goldman's latest Prime Brokerage data from last week showed both Gross and Net leverage (overall book) had their largest weekly increases since early Feb. Here are the details:

• Gross leverage +4.0 pts to 251.9% (5-year high) and Net leverage +1.9 pts to 67.8% (57th percentile 1-year).
• Fundamental L/S Gross leverage +1.9 pts to 185.6% (93rd percentile 1-year) and Net leverage +0.3 pts to 52.0% (99th percentile 1-year).