Five Leading Indicators of "Shorting the U.S. Stock Bubble" in the Eyes of Wall Street
Bank of America chief strategist Hartnett listed five leading indicators for shorting U.S. stocks, including the U.S. bank stock ETF BKX rising above $140, the tech company bond spread exceeding 100 basis points, the U.S. junk bond ETF JNK falling below $80, Bitcoin dropping below $100,000, and worsening unemployment in the U.S. He believes that rising interest rates will hinder the development of AI infrastructure, and the sustainability of retail investors is crucial for the future trend of U.S. stocks
Bank of America chief strategist Hartnett has listed "five important signals" as leading indicators for investors to start shorting:
- The Bank of America stock ETF BKX rises above $140;
- The bond spread of technology companies exceeds 100bp;
- The U.S. junk bond ETF JNK falls below $80;
- Bitcoin falls below $100,000;
- Increased unemployment in the U.S. leads to the younger generation of Americans having no money to continue buying high-risk assets (he believes stocks and digital currencies are their only source of livelihood).
From the above indicators, Hartnett believes that rising interest rates (especially for junk bonds and tech bonds) will hinder the "infinite bullets" of AI infrastructure, and the sustainability of retail investors (Bitcoin and unemployment are barometers) is crucial for whether U.S. stocks can continue to rise.
