J.P. Morgan Warns Investors May Be Losing Momentum After Strong Rally

By: fxleaders|2025/05/16 05:00:17

J.P. Morgan has cautioned investors that the recent surge in retail stock buying may be losing momentum—potentially capping further gains for U.S. equities. In a recent note, the bank highlighted signs of slowing retail activity following a strong rally. “After two strong months, retail momentum appears to have slowed in May,” analysts wrote, referring to capital flows into equities, including leveraged and inverse ETFs . The firm noted that the previous rally was “driven by leveraged equity ETFs,” as retail investors embraced a “buy-the-dip” mentality. “A slowdown in retail momentum, higher equity exposure among equity-focused hedge funds, near-complete short-covering by macro hedge funds, and a continued lack of foreign investor buying collectively suggest limited further upside for U.S. equities,” J.P. Morgan warned. Beyond equity flows, the bank also pointed to challenges investors face in hedging currency exposure. “Raising dollar hedge ratios is not straightforward,” analysts explained. While equity investors might view FX risk as a potential diversifier, bond investors face “elevated” hedging costs. J.P. Morgan also noted that enthusiasm around the so-called “devaluation trade”—which includes assets like gold and bitcoin —has started to fade. “After rising significantly in Q4 2024, the overall devaluation trade has stalled this year, becoming more of a zero-sum game between gold and bitcoin,” the report stated. Taken together, J.P. Morgan sees a “less favorable equity flow and positioning backdrop” heading into the summer.

WEEX Labs lands in Amsterdam for Dutch Blockchain Week with Agentic Day: The AI Infrastructure Economy — featuring a Cointelegraph exclusive interview with Waqar Zaka, a live AI trading competition (no code required, just natural language), and a keynote from WEEX COO Andrew Weiner. June 22. Register now: https://luma.com/lo977l6h

SK Hynix Reportedly Plans U.S. ADR Listing as Early as August, With SEC Approval Possible in Late June

SK Hynix may pursue a U.S. ADR listing as early as August, with SEC approval reportedly possible in late June amid strong AI chip supply chain demand.

SpaceX vs Tesla vs xAI: Which Elon Musk Trade Has the Biggest Upside in 2026?

SpaceX's IPO is days away, Tesla holds over 11,000 BTC, and xAI is betting big on AI. Here's how traders are comparing the three biggest Musk narratives.

OpenAI Reveals It Has Confidentially Submitted an S-1 to the SEC, Keeping the Door Open for a Future IPO

On June 9, according to an OpenAI announcement, the company recently confidentially submitted a draft S-1 registration statement to the U.S. Securities and Exchange Commission (SEC), beginning the preliminary compliance process for a potential initial public offering. OpenAI said it chose to disclose this proactively because it expected the news might leak; however, the company has not yet set a specific listing timeline, and related arrangements may still take some time.

Latest research from 13 top universities including Cornell University: The current state, challenges, and misconceptions of the fusion of Crypto and AI

The combination of AI and crypto is still in its early stages, with both serving as complementary "middleware": AI translates human intentions into executable programs, while cryptographic technology provides verifiable and tamper-proof guarantees for computational processes and results. In the dire...

Deconstructing Anthropic: The Best AI Company, Possibly Also a Type of Organizational Invention

Instead of competing with ambition, focusing on restraint, how does Anthropic leverage extreme strategic focus and an "counterintuitive" geek culture to counterattack OpenAI on the AI battlefield?