Momentum trade extremes spark Wall Street warnings

The momentum trading strategy, characterized by buying top-performing assets and selling laggards, has reached extreme levels, prompting warnings from Wall Street analysts. Recent market catalysts, including a de-escalation in geopolitical tensions and robust US employment figures, have further intensified this trend. The rally in artificial intelligence chip stocks has also contributed significantly to the current market dynamics, suggesting potential overvaluation and increased risk for investors heavily exposed to these popular trades.