The Engine & The Risk
Market Deep Dive - Positioning, Flows, and Catalyst
The S&P 500 is quietly doing something remarkable. We’re now on the 9th consecutive up day — the longest streak since May 2025 — and sitting on the cusp of a 10th consecutive up week, a run not seen since 1985. Let that sink in for a moment. 1985.
Layer in the seasonality tailwind — summer months historically favor a slow drift higher with compressed volatility — and on the surface, the bull case looks clean. But clean surfaces have a way of hiding cracks, and the evidence continues to mount that we are hitting extremes across key sectors, sentiment, and positioning.
GS Prime data shows hedge fund gross leverage rose another +2.1pts this week to ~323% – a fresh 5-year high
I’ll be direct about something: fading the initial move in tech was a mistake. This run has been genuinely historic — we are in the midst of the strongest Q2 of a Mid-Term Year on record.
My process is built around leveraging data to add a cushion on top of my thesis, and this move was simply something the data couldn’t fully account for. Sometimes the market writes a chapter that doesn’t fit neatly into the playbook. That’s trading.
The saving grace? My highest-conviction setup — ServiceNow — is now up over 60% from the lows, with long-term LEAPs doubled. Partial mistakes offset by disciplined conviction plays. That’s the game.
So where do we go from here? Let’s cut through the noise and look at what the data is actually telling us — the extremes building under the surface, the sectors worth watching, and the best risk/reward setups I can identify right now.
Tech: The Engine & The Risk
