Goldman Sachs trading department's clients have started to short non-profitable tech stocks.

Goldman Sachs' trading department said on Friday that as the meme stock frenzy resurges and triggers a surge in small cap stocks, its clients are becoming more "willing" to short the shares of unprofitable technology companies. Following a surge of about 70% from mid-April lows, a basket of unprofitable tech stocks tracked by the bank fell over 3% in the past two days. "This week, almost all of our conversations with clients revolve around one question: when to take contrarian action in the market's most speculative sectors, such as unprofitable tech stocks," wrote Faris Mourad, vice president of Goldman's US Custom Basket team, in a report to clients. "There has been more action towards the end of this week, and we have noticed that clients are starting to become willing to short at current levels."