Markets Could See Up to $80B of Selling PressureGoldman Sachs Warns of Massive Systematic Selling — Markets Could See Up to $80B of Pressure
Goldman Sachs’ trading desk recently issued a cautionary note that the current sell-off in global markets may not be over yet, and that downside pressure could extend significantly through February and beyond.
🔹 Systematic selling still in motion
According to GS, trend-following algorithmic strategies (like CTAs — Commodity Trading Advisers) have already triggered sell signals as key equity indices dipped, making them net sellers in the near term regardless of direction. Even in a flat market, these systematic models are expected to unload shares simply to rebalance positions.
🔹 Billions in potential sell-offs
Goldman’s analysis suggests:
~$33B of selling could occur this week if markets continue to weaken;
As much as ~$80B of systematic selling could be triggered over the next month if the S&P 500 breaches key technical thresholds.
Even without a further drop, models imply roughly $15B–$8B of selling in various scenarios as systematic funds reset exposure.
This selling isn’t driven by fundamental business news but mechanical trends and volatility — meaning these flows can hit markets even during mild rebounds.
⚠️ Why This Matters for Markets
📉 Equities: If trend-following selling continues, it may prolong or deepen the equity correction. These models can act independently of fundamental earnings or macrodata, amplifying volatility.
📉 Crypto (including BTC):
Bitcoin and other risk assets often move in sympathy with equities during stress periods. Liquidity drain in stock markets can spill over into crypto as investors de-risk, and systematic selling can trigger stop-loss cascades across correlated markets. Reports specifically note that such selling could pose downside risks for Bitcoin, gold, and silver as liquidity conditions deteriorate.
🧠 What This Means in Practice
💡 Not a guaranteed crash, but a higher probability of continued volatility and downside pressure across risk assets if:
Key equity support levels break
Volatility stays elevated
Trend-following models remain active sellers
This is not about fundamentals turning suddenly weak — it’s about technical and systematic flows creating selling pressure on autopilot.
