Bearish positioning by hedge funds is at extreme levels: Hedge fund short positions in US-listed ETFs surged +10% on Thursday, the 2nd-largest single-day increase in data going back to 2016. The only bigger day was April 2nd, 2025, "Liberation Day," when shorts jumped +16%. As a result, US-listed ETF shorts soared +12% this week alone, following a +8% increase last week. In total, short positions are up +23% over the last month. Meanwhile, hedge fund short positions in US macro products, including index futures and ETFs, are up to 11.5% of total US exposure, approaching the 2022 bear market peak of 11.6%. Over the last 5 years, short exposure has only been higher in 3% of cases. Hedge fund shorts are at extreme levels.(The Kobeissi Letter)