The Melt-Up Keeps Sucking People In

Investors are aggressively chasing AI and semiconductor momentum as market breadth fails and hedging costs hit record lows. This setup creates a fragile 'melt-up' environment with significant downside risks if the narrow leadership falters.

Key Takeaways

• 1.The market melt-up is increasingly crowded in AI and semiconductors while underlying breadth continues to deteriorate.
• 2.Downside protection is historically cheap and being abandoned, creating potential for a sharp, 'nasty' move lower if gamma unclinches.
• 3.Market correlation has collapsed to record lows, showing similar dynamics to the 1990s dot-com era bubble.

Table of Contents

• Dollar lagging
• Dollar disconnect
• Narrow leadership
• Correlation collapse
• Dot-com vibes
• Huge demand
• Vol insanity
• Chasing momentum
• Aggressively hated
• Down could get nasty

Document Preview

Page 1 of 4

Subscribe for full accessStart Free Trial