First Crack in the AI Bull

MoMo & AI warning

High beta momentum was down 8% yesterday. This is one of the top ten one day moves in the pair over the last five years. What seems to be driving this is that secular AI themes are selling off post recent extreme performance. Some profit taking is of course nothing to worry about and the fundamental story hasn't really changed, but it looks like we're in a short-term trading backdrop that's a little too stretched.

GS: "Valuations are stretched, positioning in momentum is high (exposure is our Prime Book is at the highs: 99th percentile 1-yr, 100th percentile 5-yr), factor volatility remains elevated"