In the latest readout from the JPM Treasury Clients Survey, market sentiment among participants reveals subtle but telling shifts in positioning. The landscape continues to reflect a cautiously optimistic tone, underscored by a modest increase in bullish outlooks and a pullback in bearish sentiment.

Marginal Uptick in Long Positions

According to the survey results, the proportion of clients holding long positions in U.S. Treasuries rose by 2 percentage points. While not a dramatic surge, this change suggests a growing, albeit measured, confidence in the bond market’s near-term prospects. In an environment still grappling with inflationary pressures, rate uncertainties, and geopolitical overhangs, any rise in long positioning can signal a shift in the collective market psyche — one leaning toward expectations of rate stabilization or potential economic softening.

Shorts on the Retreat

Mirroring the increase in longs, short positions dropped by 2 percentage points. This decline in bearish bets may reflect a belief that the Treasury market has found some near-term footing, or perhaps a recognition that the risk-reward calculus of betting against bonds is no longer compelling. When shorts pull back without a corresponding increase in neutrality, it’s typically a sign of capital rotating into longer-duration assets rather than sitting on the sidelines.

Neutral Stance Holds Firm

Interestingly, the proportion of neutral respondents remained unchanged. This stability suggests that while some investors are shifting their exposure, the overall appetite for radical repositioning remains muted. A consistent neutral base implies that a significant portion of the market is still in wait-and-see mode — content to observe upcoming economic data and policy signals before committing to a directional bias.

Near-Term Sentiment Anchored to Recent Averages

Zooming out, the all-clients survey results remain closely tethered to their four-week average. This reinforces the notion that, despite the minor shifts observed, market sentiment is relatively stable. These steady readings highlight the delicate balance investors are striking between cautious optimism and strategic defensiveness.

Active Clients Lead a Bullish Charge

Perhaps the most notable takeaway from the latest survey is that active clients are now holding the most net long positions since May 5th, 2025. This segment of participants — often more tactically inclined and sensitive to short-term signals — appears to be positioning for a potential rally or stabilization in Treasuries. Their increased bullish stance could be driven by expectations of slower growth, dovish policy pivots, or simply technical setups in the bond market.

While the overall positioning data doesn’t signal a major directional breakout, the subtle rise in longs and decline in shorts hints at a market that is gradually leaning toward optimism. Active client behavior, in particular, may serve as a leading indicator of broader sentiment shifts. As always, these trends warrant close monitoring, especially in a macro environment where the next piece of economic data could tip the balance in either direction.