Good morning,

Goldman's derivatives desk just dropped a positioning report that should have every trader's attention this morning.

The long-only community is $10 billion better for sale month to date, one of the largest monthly sell skews in four years.

One-month skew is the steepest since 2022.

And here is the part that really stands out: zero S&P call demand on the Goldman floor. Zero.

Retail call volumes in megacap names have fallen to levels not seen since 2017. Nobody wants upside.

Their own conclusion is that investors are preparing for the index to finally reflect what single stocks have been saying for a while. Their words: something's got to give.

The CTA medium-term sell trigger for the S&P is 6,735.

We are about 100 points above it. If we break that level, systematic selling kicks in at 8.5 billion dollars in US equity sales. The gamma is already flipping negative on minimal dips.

Meanwhile, the AI scare trade is no longer just a tech story. It is a credit story now. Arini Capital, one of the biggest forces in European distressed debt, said yesterday that the rising cost of capital for software companies will lead to significant defaults. Blue Owl is already gated.

Software SaaS loans are trading at distressed levels. And Jamie Dimon went on stage at the JPMorgan investor day and drew direct parallels to 2005, 2006, and 2007. His exact quote: I see a couple of people doing some dumb things. When the CEO of the largest bank in America tells you he sees pre-crisis behavior, you listen.

On top of all this, the 10% global tariff went into effect this morning.

Trump addresses Congress tonight at 9 PM, and traders need to watch for escalation language on trade, his Iran posture, and any shots at the Fed.

That is the setup for today. Five stories connected by one theme: risk is being repriced.

Join me at 8:45 AM ET on TheoTrade for Market Masters, where we break all of this down live.

See you in there,

Garrett Baldwin