S&P 500 dropped by 0.15% on Tuesday amid sell-offs in the market.

IHS Markit reported that when the index was near all-time high, short interest in the $357 billion SPDR S&P 500 ETF Trust (ticker SPY) rose very sharply. Now, about 4.8% of the fund's shares are on loan, which is 2% lower than two months ago.

And even though the indicator remains below the highs of the last two years, a bearish reversal still occurred in the market.

Independent Advisor Alliance CIO Chris Zaccarelli said: "The rising short interest in the S&P 500 is partly driven by skepticism that the rally will continue. The bull market is not expected to end early, but given that a 10% retracement occurs every two years (since 1980), a pullback is very likely this year. "

In addition, Chris Murphy, co-head of derivatives strategy at Susquehanna International Group, said that real dividend yields and real yields on the S&P 500 recently turned negative. Hence, they expect various sharp pullbacks, but those will be short-lived and remain low by historical standards.

Considering this, investors should look at long positions in the S&P 500.