Strategy Video: What Will Signal the Collapse in Sentiment, Markets?
• After years of escalation in risky positioning, trading a true market turn demands serious confirmation
• There are plenty of assets sensitive to 'risk' - SPX, equities, high-yield, VIX, dollar, yen crosses, etc
• Yet, we don't want to trade the barometer's change, we want to position for the genuine theme shift
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Years of building up risk positions on thinning liquidity and every greater levels of leverage means the inevitable reversal is likely to be intense and potentially disorderly. However, trying to jump into a reversal before it has taken root can quickly scuttle a traders account. As such, we need patience and a good means for assessing the underlying market situation. In today's Strategy Video, we discuss what would constitute good confirmation of a change in this important fundamental theme rather than just a temporary move from one of the many markets sensitive to its current.
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