Investors Should Pay Attention to Short Positions in US Stock

May 31st from WikiFX News.After the heavy slump in February, the US stock market has regained nearly 38% to date since March 22nd. WikiFX reminds investors that more attention should be given to the short interest in US stock market.

James McCormick, the Wall Street veteran who has been a market analyst since the 1990s, said that tracker funds had previously accumulated plenty of US stock market short positions, which can significantly affect the stock markets future trend.

S&P 500 Index is currently very close to 200 SMA (26339) and whether the level will be breached is significant to changes in positioning by investors. McCormick observed that this key indicator is near the most bearish level, with net shorts at the highest level since 2016, so this level is definitely worth-noting.

Currently, the Federal Reserve‘s liquidity is supporting the price of stocks and other assets, but this is not a good phenomenon from a long term perspective, for expanding monetary policies won’t cushion the hard blow on supply chains, and the long-term impact of unconventional monetary policies such as QE can be worrying.

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