Wall Street sentiment remains fragile after a week of extreme volatility, with traders at Goldman Sachs warning that the stock sell-off may not be finished yet. According to a fresh Bloomberg report, market participants are bracing for another potential round of selling after mixed price action and uneven buying patterns last week.
Traders say a further decline in major indexes could trigger as much as $33 billion in automatic selling this week, and if the benchmark S&P 500 slips below key technical levels, that number could grow to about $80 billion. Such forced selling would come from systematic strategies like commodity trading advisers (CTAs) and volatility-targeting funds that adjust exposure as markets become more unsettled.
The warnings underscore how fragile investor confidence has become after months of mixed signals across asset classes. Retail dip-buying, which helped support markets through previous corrections, has weakened: recent data showed about $690 million of net selling last week, suggesting that buyers are now less willing to step in at every pullback.
This comes as Wall Street wrestles with wide market swings driven by concerns over AI-related tech valuations, cautious positioning ahead of key economic data, and lingering uncertainty about monetary policy direction. Investors will be watching closely in the coming sessions to see whether the market stabilizes or if the recent turbulence is a sign of more volatility ahead.
Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
Related: Investors chase cheaper, smaller companies: Here is why
