Why not go all-in and make heavy positions?
One of the reasons is that the situation in the Middle East is unsolvable and will definitely not end in the short term.
The second reason is the United States itself - the expectation of a possible interest rate hike.
When many people mention the expectation of another interest rate hike, they always say that Jamie Dimon of JPMorgan Chase said that it would be raised to 8%. But in fact, when he said it, the expectation of another interest rate hike had already appeared, and his remarks were just brewing and guiding expectations on the surface. The reason is very simple. This month, the US ism manufacturing index returned above the boom-bust line, and the soaring commodities showed this possibility two weeks ago.
Because the composition of the core CPI data is divided into core commodities and core services, the rapid decline of CPI last year came from the contribution of falling commodity prices. In fact, the core services in the United States have always been sticky and basically have not decreased. If commodity prices start to rebound, you can't imagine what will make this data fall. The data speaks for itself. Yesterday, the US 20-year Treasury bond ETF TLT plummeted 1.55% during trading, which shows that the market is betting on the continued rise of long-term interest rates.
The situation in the Middle East, the expectation of another rate hike, all of these translate to "uncertainty".
Uncertainty is inherently favorable to short sellers, because when you feel that uncertainty is increasing, you tend to hold cash rather than assets.
