Below is a chart and brief excerpt from today's Early Look written by Hedgeye CEO Keith McCullough.
Whether you needed to read Goldman’s note yesterday about “no sign of de-risking as hedge funds bought the dip in US Equities”, or you already knew that because you measure and map the data, deliberately, and daily… just know the crowd is still big time long.
Even though I have no fundamental reason to short Tech in #Quad3, my quant signaling process is suggesting I should consider it!
Bottom up, we have plenty of Ami Joseph Tech Stock SELL ideas that are working. But, top-down, from an Asset Allocation perspective, all I’ve done was take down my gross long exposure to Tech (pre the draw-down). I didn’t short AAPL, XLK, or QQQ.
Other than particular Tech companies #slowing and/or guiding lower in Q3, what fundamental Quad would have me short Tech?
A) Deep #Quad3 or
With everyone’s brother, sister, and dog trying to “rotate” into a #Quad2 portfolio of SMALL CAPS (IWM) and Financials (XLF) + Leverage, it probably rings a bell in your head when I remind you of the risk of the probability rising for #Quad4 in Q4 of 2020.