Panic and greed intertwined! Massive shake-up in US stocks, tech sector is changing face, is the "buy with eyes closed" strategy failing?

Since the end of March, the US stock market has been on the rise, with one-sided long positions becoming a favored strategy for many investors. However, this trading logic faced a test in the past week. For most of this spring, large-cap tech stocks were the most stable choice in the market, but now the market's confidence in these giants has weakened, leading to the tech sector fluctuating and oscillating. This frequent reversal has also dragged down the entire S&P 500 Index, with the index reaching its highest volatility since the tariff turmoil in April 2025 earlier this week. Strategists at 22V Research have stated that as investors balance between a good economic fundamentals and a tightening monetary policy outlook, the volatile market trend may continue. The company's "Market Sentiment Differentiation Index" has climbed to the 94th percentile of historical data, indicating an increasing divergence among investors on the stock market direction. Dennis Deboucher, Chief Market Strategist at 22V Research, said, "The current market is swinging violently between risk appetite and risk aversion, with a level of oscillation rarely seen in years." The US employment data released last Friday far exceeded expectations, leading to the expectation of a Fed rate cut this year not materializing. Since then, market risk appetite has been fluctuating. 22V Research pointed out that this employment data has put the market into a "risk-off mode" for the first time since January. Over the next four trading days, the performance of the information technology sector has been volatile, sometimes leading the S&P 500 Index, and sometimes lagging behind. The Nasdaq 100 Index plummeted 4.8% last Friday. The index has seen 1% or more fluctuations for five consecutive trading days, equalling the longest streak of significant fluctuations since August 2024. Ken Maoni, CEO of Maoni Asset Management, said, "After a historic rally, the market is now experiencing a phase of consolidation, and two-way swings will become the norm. Like in the movie 'The Perfect Storm', this market is being hit by a combination of strong winds, cold fronts, and heavy rain." Fear and greed intertwined. After the employment data was released last week, market volatility increased. Defensive sectors initially performed well, followed by a surge in the tech sector, leading to market oscillations. On Thursday, despite the US Producer Price Index for May posting its largest year-over-year increase in over three years, risk-on trading re-emerged, with funds starting to accumulate chip stocks under pressure. Jin Forester, Chief Investment Officer and founder of Bokeh Capital Partners, said, "This week, a series of heavyweight events have clearly shown the swinging b...