Futures net positioning on the S&P500 is getting extreme as a percentage of open interest. Speculators are hedging their long positions or simply betting the overall market will correct. Furthermore, they’re not short the whole market; the futures positioning on Nasdaq 100 index is positive, showing bullish expectations, which would indicate, speculators are betting big tech companies will continue to outperform vs other sectors. Current readings have only be seen in the las 20 years during the #dotcom era and the #gfc. This extreme positioning typically will end up reversing, when speculators unwind the trade.
Chart source: WSJ
