Bad Day For the Big Short, Thanks To Dip Buyers

Today was not a good day to be short AI stocks like Nvidia (up 5.8%) and Palantir (8.8%). They both rebounded dramatically, along with other AI stocks following last week's selloff (chart). Investors and traders bought the dip again. It's hard to short stocks in a bull market. The Magnificent-7 rose 2.8% today after falling 3.4% last week.

The AI trade remains the Big Story that might continue to frustrate the new Big Short, i.e., the positions of traders who believe AI is a bubble that will soon burst. We don't think so.