Has the market found a bottom ⁉️
So, although it's impossible to truly know, are positive signs starting to accumulate? 👀
Let's check! 🔎
Recently we've experienced market corrections, and lately there's been some slowdown in the indices, but what's happening behind the scenes? 🔎
We've gathered some of the more interesting signs for you -
🚩 J.P. Morgan's 'collar': The 'collar' is an investment protection strategy where the investor buys put options to protect the investment, and writes call options, limiting their profits, so that the premiums collected cover the price of the put options. 🛡
This situation creates a kind of neck between the investor's maximum profit and their protection range, and this, friends, is called the 'collar'.👀
So J.P. Morgan has such a collar, and as can be seen in the chart, its upper bound is exactly at the all-time high of the S&P 500 index, but what's interesting here is the lower bound... There are 40,000 put options at the 5565 point on SPX expiring in March 👀, and that's exactly where the declines showed initial signs of slowing down. Although last Thursday we dropped below the line, is this still an excellent position for a rebound? 🟰
Considering that historically the index has only dropped below the collar once, which was in March 2020, and touched the collar two other times, is this a sign of a temporary bottom? ⌛
🚩 Hedge fund positioning: Many in hedge funds claim that, 'a 10% correction in the indices is completely normal, statistically it happens once or twice a year.' 🕯
There is some truth to that, but this correction was different. In terms of hedge funds' unloading of stocks, the funds sold off stocks at an enormous speed 📉. In fact, the funds' exposure to stocks dropped below the 2020 low ❗️
This means that in terms of hedge funds' selling supply, we are in an oversold situation, and if there is calm in the market, the funds could certainly use the cash that has accumulated in their coffers..💵
🚩 Algo funds positioning 🤖: In recent weeks, algo funds have aggressively sold stocks. According to Goldman Sachs' analysis, the funds' selling positioning has now calmed down. Not only that, but if the market rises, the funds will even start buying back $92 billion in the coming month, $45 billion of which will be in the S&P 500 index. ✅
And this is definitely a positive sign. 🙏
🚩 The Fear and Greed Index is rising for the third consecutive day - investors are lowering their level of protection and the level of fear in the market is decreasing...📊
🚩 According to Bank of America, the last week saw the third largest weekly capital inflow in history 🔝
Are the buyers already here, beneath the surface? 👀
(Images for all mentioned data are attached)
The information was written by our new team member - Elazar. Elazar is an expert in finding golden insights under the radar - and starting today, he will operate the channel on an ongoing basis. 🎓
Channel manager's note - ✏️ Recently, the channel's activity slowed down - this was due to our team of experts building a unique real estate system and a unique crypto system. 👨🏫
Starting today - the channel returns to full activity, and we will continue to actively operate here with all the most important information in the stock market, as we have been doing for you for many years! ✔️