SIGNS OF BULL MARKET FATIGUE?

During the week of 7 July, investors pulled $491 million out of ProShares UltraPro OOO, an exchange-traded fund that invests in surging tech stocks. The weekly outflow was the largest since the fund’s founding in 2010.
Despite the outflow, the fund ended the week with a record $7.1 billion in assets, due in part to strong gains by Alphabet, Amazon, Apple, and Tesla. During the same week, the same company’s fund that “shorts” the market, or bets on stock prices falling, took in $261 million in new investments.
“We expect the unemployment rate to remain elevated for years,” Capital Economics wrote in a note. Analysts speculated that investors might see the GDP’s growth as fueled by federal bailout funds that may not be sustained.
“There are few signs of an organic recovery being in place which would ultimately promise a boost to risky assets as demand recovers,” said economists at the Netherlands’ Rabobank.
TRENDPOST: More new investors shorting the market than going long, even in a single sector, is a red flag that the bull market is on shaky ground.
Overvalued equity markets should have crashed long ago as economies were locked down. However, since central banks and governments are making up “schemes undreamed of” to artificially prop up failing economies, it is impossible to accurately predict when equities will crash.
It is most important to note that keeping equity markets from crashing is a primary initiative of governments since an uniformed, sound-bite-news public, which have no in-depth knowledge of the real socioeconomic or geopolitical world, will come to realize the extent of economic destruction only when the headlines read: MARKETS CRASH.