52% of stocks have already fallen into oversold territory, but he insists on waiting until 88% before making a move 🦖
📈 进群看今日思路
BofA chief strategist Hartnett’s bull-bear indicator fell from 8.1 to 7.4 this week, dropping below 8.0. That means the sell signal he issued on May 26 has officially ended.
But in the latest edition of Flow Show, he made one thing very clear: the end of a sell signal does not mean a buy signal. For him to return to tech stocks in mid-November, two conditions must be met—and neither has been fulfilled yet.
First, the Fed needs to hike rates on October 28. The market currently puts the odds of a hike at just 15.5%, down from over 50% a week ago. In other words, the market has already decided the Fed won’t act—which is the exact opposite of the credibility-restoring move he described. ⚖️
The second condition is that concerns about AI financing ease. The reality? We’ve just had the worst week of the year: the Nasdaq 100 fell 5.5% in a single week, its biggest weekly drop in 18 months. The spread on CoreWeave bonds maturing in 2031 briefly exceeded 1,100 basis points over US Treasuries, while its five-year CDS implied a default probability of about 63%. And that’s before you even get to the $1.16 trillion in capital spending hyperscalers are expected to make next year, while free cash flow is projected to worsen from negative $63 billion this year to negative $163 billion. 💥
What stings even more is positioning. Of the S&P 500’s constituents, 355 are more than 10% below their 52-week highs, 188 are down more than 20%, and 93 are down more than 30%. Yet equities make up a record 66.4% of BofA private clients’ portfolios, with cash at just 9.3%. Their overweight in tech stocks is the highest since August 2020. People say they’re scared, but they haven’t actually sold.
This isn’t something crypto can afford to watch from the sidelines. Bitcoin is currently around $81,648, up just 0.22% over 24 hours. Ethereum is at $2,408 and still down over the past 24 hours. Since the start of October, US spot Bitcoin ETFs have seen cumulative net outflows of about $615 million. Rate-hike odds have fallen all the way to 15.5%, yet prices still haven’t lifted. That suggests the market has already priced in the easy-money expectations, and is now waiting for actual money to come in. 🐋
My take: the most important thing to watch right now isn’t what the Fed says, but the 10-year real yield, which is already nearing 3%. Historically, levels around here have coincided with the bursting of the dot-com bubble, the global financial crisis, and Silicon Valley Bank. The other thing to watch is semiconductor prices. If they rise, it means the AI arms race is still on, and risk appetite could return by mid-November. High-beta assets like Bitcoin usually move first. If they fall, that points to tightening AI credit and peaking capital expenditure—and risk assets will be the first to get hit.
So don’t mistake the end of a signal for the starting gun. Cooling sentiment doesn’t mean money is flowing in. A real turning point will have to wait for the real yield and chip prices to show us the way. Until then, treat every rally as just a rally.
How much of your portfolio are you still holding as you wait for November? Let’s talk in the comments.
I bring you the latest crypto market trends every day—not just what’s happening, but the logic and opportunities behind it. 👀🚀
Tap my profile picture to watch the livestream
📈 进群看今日思路
BofA chief strategist Hartnett’s bull-bear indicator fell from 8.1 to 7.4 this week, dropping below 8.0. That means the sell signal he issued on May 26 has officially ended.
But in the latest edition of Flow Show, he made one thing very clear: the end of a sell signal does not mean a buy signal. For him to return to tech stocks in mid-November, two conditions must be met—and neither has been fulfilled yet.
First, the Fed needs to hike rates on October 28. The market currently puts the odds of a hike at just 15.5%, down from over 50% a week ago. In other words, the market has already decided the Fed won’t act—which is the exact opposite of the credibility-restoring move he described. ⚖️
The second condition is that concerns about AI financing ease. The reality? We’ve just had the worst week of the year: the Nasdaq 100 fell 5.5% in a single week, its biggest weekly drop in 18 months. The spread on CoreWeave bonds maturing in 2031 briefly exceeded 1,100 basis points over US Treasuries, while its five-year CDS implied a default probability of about 63%. And that’s before you even get to the $1.16 trillion in capital spending hyperscalers are expected to make next year, while free cash flow is projected to worsen from negative $63 billion this year to negative $163 billion. 💥
What stings even more is positioning. Of the S&P 500’s constituents, 355 are more than 10% below their 52-week highs, 188 are down more than 20%, and 93 are down more than 30%. Yet equities make up a record 66.4% of BofA private clients’ portfolios, with cash at just 9.3%. Their overweight in tech stocks is the highest since August 2020. People say they’re scared, but they haven’t actually sold.
This isn’t something crypto can afford to watch from the sidelines. Bitcoin is currently around $81,648, up just 0.22% over 24 hours. Ethereum is at $2,408 and still down over the past 24 hours. Since the start of October, US spot Bitcoin ETFs have seen cumulative net outflows of about $615 million. Rate-hike odds have fallen all the way to 15.5%, yet prices still haven’t lifted. That suggests the market has already priced in the easy-money expectations, and is now waiting for actual money to come in. 🐋
My take: the most important thing to watch right now isn’t what the Fed says, but the 10-year real yield, which is already nearing 3%. Historically, levels around here have coincided with the bursting of the dot-com bubble, the global financial crisis, and Silicon Valley Bank. The other thing to watch is semiconductor prices. If they rise, it means the AI arms race is still on, and risk appetite could return by mid-November. High-beta assets like Bitcoin usually move first. If they fall, that points to tightening AI credit and peaking capital expenditure—and risk assets will be the first to get hit.
So don’t mistake the end of a signal for the starting gun. Cooling sentiment doesn’t mean money is flowing in. A real turning point will have to wait for the real yield and chip prices to show us the way. Until then, treat every rally as just a rally.
How much of your portfolio are you still holding as you wait for November? Let’s talk in the comments.
I bring you the latest crypto market trends every day—not just what’s happening, but the logic and opportunities behind it. 👀🚀
Tap my profile picture to watch the livestream