We touched 6700, momentum stalled, and the tape feels heavier than it has in months. Systematics are stuffed, pensions are set to sell in size, and leadership is cracking slightly. For the first time in a while, the near-term asymmetry doesn’t look clean to the upside.
Funds cut risk last week at one of the fastest clips since July 2024… Some de-grossing last week and nets slashed too. Industrials and Tech both hit. Even as SPX held relatively close to the highs, the internals told a different story: dispersion’s wide, single-stock vol is still bid and call skew is stretched. Add into that quarter-end supply, one of the largest on record.... With systematics already “max long” and vol-control stuffed, the marginal juice just isn’t what it was back in June or July.
I’ve said disbelief fuels the rally, and that the right tail is alive most of the way up. And as you probably guessed, this isn’t another so-called “unapologetically” bullish post. It’s just a realistic one. One where I write my observations as they are… near-term cracks worth respecting, even if the bigger picture hasn’t fully cracked.
Let’s dig into it.