Whenever you get these V-shaped type moves, uh, you know, it's always tricky. It's very difficult to make money. People normally try to buy dips for a certain period of time and then they throw in the towel and start to sell. And as fear reaches extremes, that's normally when we start to rally. And very few people want to to buy into the rallies, they they start selling into them.

Welcome to thoughtful money. I'm its founder and your host, Adam Tagert. When today's guest was back on this program in January, he predicted that stocks would soon experience a 10% correction, that the precious metals would experience a big pullback, and that oil had found a bottom. Well, he was right. And this was before the war with Iran broke out. So, how has the war impacted his outlook for the coming quarter? to find out. We're fortunate to welcome back to the program Mark Newton, head of technical strategy at market research firm Funstrat, where he works with its founder, Tom Lee. Mark, thanks so much for joining us today.

My pleasure. Thanks for having me back, Adam. Good to see you.

Uh, well, thanks, Mark. Um, it's a pleasure to have you back and folks have really enjoyed your quarterly outlooks, Mark. So, um, I'm sure this will be no exception. Um, folks are going to love this one. Um, I do just want to underscore the props I gave you there in the intro. Um, now you didn't know that we were go, well, to my knowledge, you didn't know that we were going to go to war with Iran in a month after we talked, but all the trends that you you thought were in place and were going to happen pretty much happened.

Mhm.

Uh, it's been a remarkable time. We've had, you know, I guess not dissimilar to last year, an early spring selloff that caught a lot of people offguard for different reasons. And now just a remarkable uh snapback rally. You know, we've been up 3% for each of the last three weeks. Quite unusual. Up 12% now over the last 14 trading days. So, you know, that kind of thing uh doesn't happen quite that often. Um I I think it's the most violent rally, whatever you want to say, since the 80s. Did I hear that?

I think the quickness with which we've recovered uh certainly has set some records. I think it's it's never happened in 11 days where the market's gone from a 100 day low to a 200 day high.

Uh I think the next closest was October of 2014, but but certainly one for the record books and and pushing, you know, aggressively back to new all-time highs.

All right. So, um so obviously this is happening. Um why don't we start with this? Why is it happening? Um, I mean, obviously one explanation is is that the war is uh or the markets are basically pricing in a a near-term end to this war. Um, uh, oil kind of doing the same. I mean, it's down from its its all time from from its highs from a few weeks back.

Um, on the day we're talking, it's up a couple percent. It's kind of hovering around Brent crude futures are hovering around 90. Um, so it's it's it's not I don't know. Oil doesn't seem to be as sanguin about the war as the markets, I think. But you tell me.

Look, I think the market gave us a couple of clear indications uh back in late March that it could start to stabilize and turn higher that maybe many investors uh did not quickly catch on to. Uh for those that use technicals, we did see a meaningful amount of breadth improvement which really started right around mid-March where you look at things like the percentage of stocks above their 20-day moving average and 50 really started to jump uh pretty substantially and that was uh interesting and something that the broader you know S&P really didn't showcase properly if you're looking at the markets which continued to drop but yet you know far fewer stocks were hitting new lows and that's almost always something that happens uh when markets are approaching a bottom. The same thing happens by the way when you're approaching a top and we also saw that uh in the middle part of January where fewer and fewer stocks were participating and starting to turn down.

Mhm.

So, uh, you know, the other is that we started to see some real evidence of defensive sectors really starting to deteriorate and and sectors like consumer staples, which according to my work, uh, you know, were one of the few things that actually did show the potential for a sell-off just based on, you know, risk off, risk on type positioning. when the defensive sectors really start to gain in strength, that's normally a time when, you know, you have to be a little bit more cautious or expect you can see a possible trend break. And and we saw exactly the opposite, honestly, in in March. We saw consumer staples go uh straight down, you know. So, those are a couple of things, but but interestingly enough, you know, we never really truly saw markets get all that oversold. Uh we also really didn't see any true capitulation like what I normally like to see an excessive amount of downside volume. Uh that never happened. So you know the fact that markets can all of a sudden just uh stabilize and turn higher. It had to do specifically with the fact that uh you know crude oil which was at $115 started to rapidly decline. And and I think that is something investors need to pay attention to crossasset type analysis when you get things that have coincided with market weakness which finally start to go the other way. Uh specifically dollar moving up, crude moving up, uh rates honestly uh pushing higher and all those things started to back off. That was a a really, you know, interesting thing and and honestly coincided with a period where the markets were forwardlooking and expecting that we would see some type of a truce and and you know, we know that that of course is is honestly something that can't happen very quickly. Um, many are estimating that the conflict likely will continue until probably September, October, but it doesn't mean that the straight can't be reopened. And I think the market had a lot of confidence in uh the speed and quickness to which we went in and sort of accomplished uh some of the goals that were attempted and and you know it's an election year. I have to say that that the administration cannot afford to have crude oil at $100 heading into driving season. It would just be uh devastating uh really to the chances that the GOP will certainly lose the house if things don't improve dramatically. And um if that happens then Trump is going to be a lame duck in his final two years. So we know that for from a political standpoint it's essential to figure out an exit ramp. And I think that uh the market at least was was sniffing out the possibility of uh of yet again uh you know the negotiation style of of being probably a little bit harsh initially but then starting to back off and uh that the market clearly u you know with the strength in technology and the rebound that we've seen uh you know has been totally focused on earnings and the fact that earnings have been good the economy honestly has held up I think much better than many people expected. So, those are a couple reasons, but whenever you get these V-shaped type moves, uh, you know, it's always tricky. It's very difficult to make money. People normally try to buy dips for a certain period of time and then they throw in the towel and start to sell and as fear reaches extremes, that's normally when we start to rally and very few people want to to buy into the rallies. They they start selling into them. And so, um, you know, most trend followers get caught off guard. We saw commodity trading advisors, you know, had about $85 billion that they had to rapidly reverse and start to buy into this market as it started to rise. So that was, you know, initially something which uh might have been seen by many as short covering, but eventually it turned into real buying and we saw a very meaningful snapback in in technology which had been lagging for largely the last six to eight months. I mean maybe the Mag 7 had been under a lot of pressure. So, it's always encouraging when a a healthy slug of what really is powering the earnings environment starts to rebound and and I think that uh you know here we are uh new highs for for many of the indices not only here but also globally and and that's also something that investors need to pay attention to is that it's not just a US phenomenon that we're seeing the stocks 50 uh you know euro stocks 50 and the stock 600 in Europe as well as the Nikkay and other indices that are pushing back to new highs. those normally aren't things that happen if you're nearing a recession. So, you know, my my my big takeaway here is that history shows us that when you enter big geopolitical conflicts that normally uh stock market tends to bottom in a very short period of time after they've begun and typically it's about 3 to four weeks. Um we even look back towards World War II and know that markets of course bottomed very early on in 1942 and uh started to turn meaningfully higher throughout the conflict. So always tricky to to make too much of uh exogenous type events. Uh markets tend to catch up and understand very quickly that uh how to price risk and and what could happen. And I think in this case uh you know rebounded rebounded very sharply for reasons that probably many people uh were unaware of of why they should have rebounded.

Okay. So I got a ton of questions here for you Mark. Um but let's let's start with that one. Um so um my question my question for you that I'm going to I'm going to add a little bit to it. um is is how much do you trust this rally? You know, you're you're a techn you're a technical analysis guy. So, you don't really take the macro much um into your decision-m at the end of the day. You're just looking at what the market is telling you. You're nodding as I'm saying all this. I I know you you look at the macro space, but but you you let your decisions be based upon what your the TA is telling you. Um, so for the people, so I'd like you to answer that question, but in answering it, um, the people who are concerned, and there probably a lot watching this video right now who are thinking, um, okay, even if this war comes to a conclusion soon, there's been a shock to the global economy, right? We've had this oil price shock. We have had compromised supply chains. Um there are delays of important um commodities out there. Uh not just oil and gas, but also helium and fertilizers and things like that. Um and so they're saying, look, this is going to be a net negative to the economy even if it ends now. Um and of course that net negative will just get worse the longer this war continues here. But um there are a lot of people who are thinking, okay, so you know, there's there's already some demand destruction that's gone on even if the war ends soon. And and we're going to have to pay that price at some point, whether that's in lower earnings for Q2 or um supply shortages down the road. I'm hearing, you know, concerns about food shortages in the fall. Um, do you have those concerns or or are you saying that that uh the market is basically saying, "Nah, it's really not going to be that bad, folks."

To your earlier point, you know, I I don't have analytical data that that tells me that all those concerns are immediately manifesting in the market. If if the if the market rally happened and it shocked people, uh the most important lesson that I ever learned from technical analysis was that uh it's always important to understand that the market's right. Not that we think that oh the market's wrong and it doesn't understand and I'm right to have maybe uh emotional but correct reasons on thinking something could go wrong. It's more about um you know you have to adjust your your your risk parameters when things catch you off guard and understand that uh the earnings picture is good. It's picking up. I mean fundamental analysts have been raising uh earnings revisions earnings revisions are going higher and and honestly the amount of defense spending is helping to juice the economy. We also know that AI is a very deflationary effect and and helping productivity to such extent that uh the Fed potentially could afford to cut rates and not really have that be inflationary. So the bottom line is those aren't things that I use to make decisions. Okay, you noted in the beginning I'm I'm a technical analyst. I I look at things like breath and momentum and and those have improved marketkedly in in the last uh few weeks and and it doesn't pay to say well the market's up 12%. And it's definitely wrong. Uh the cycles were something I looked at early on to understand that we were going to be in a time when markets could in fact decline. And my forecast last December, which I relayed with you, was that we would likely see a peak in the latter part of February that would fall into April and or May and then bottom and turn higher into the fall. And I'm standing by those comments. I think the market has made a definitive bottom. That's not to say that the market is a bit over its skis a bit at this point that we've gotten a bit ahead of itself. Um I do suspect that we, you know, potentially give back probably 3 to 5% of the 12% maybe that we have done. So that likely could happen between now and the middle part of May if what I'm thinking is correct. uh always tricky to, you know, when a market's moving this this fast to to say, "Well, I'm just going to go against it." It's it's rarely correct to fight trends. The trend has turned very bullish and you really have to respect that until you see proper warnings as to why that's that's not correct. And that's just my own discipline. So, uh you know, the breadth has improved, the momentum has improved, sentiment certainly hasn't improved. Uh to your point, uh you make a lot of great points. I think there's a lot of uh legitimate concern about what's happening and and the implications of of how that can affect the economy. But we know that this year is a midterm election year. It it it before the year started, it was set upon as being a year that could be very choppy, not a year that was going to be straight up or straight down. And I think we're already seeing evidence that, you know, we saw a 9% correction and now an immediate push back to new highs. A lot of sectors arguably have not participated in that move to the extent that I would like to see. We only have one of the 11 equated sectors sector ETFs back at new all-time highs and that's technology. So other areas like uh you know discretionary and industrials are are still to some extent lagging. I I would mention that you know it is important to see financials and uh discretionary and industrials have good movement. Um, and I think that has happened to the extent that we haven't really seen since last summer. So the bottom line is that when you look at things like seasonality, uh when you look at cycles, when you look at sentiment, when you look at uh pure technical um structure and and breadth and momentum and what's driving the market, um it it it doesn't make me want to immediately jump on the other side based on reasons that I have no way of calculating as to whether how they're going to affect the economy or how they're going to affect earnings. So just these are all you know it's logical in any market to say well what if this goes wrong and what if that goes wrong but but you know the the path has been set and regardless of what we think of how long this can last u and I think it probably does last till September October I don't think it's over immediately but I also think that 3 months of the straight being closed can lead to to certainly uh to global uh recession and that would be something to really pay attention to if and when they can't figure out a proper exit ramp in a way that would reopen the street. So, you know, if I have to make a geopolitical guess, I say the conflict lasts another, you know, five or six months. However, I I sense that there will be some agreements that will temporarily open uh the strait. Um and and the real tricky part is this fog of war where you don't really know what to believe on on either side. And that's pro part of proper negotiation with these conflicts and and it always is tricky to to understand if what you're being told is is the truth. Um but the bottom line is you have to trust the market and and the market has uh completely um you know priced out now any chance of a rate cut this year. We'll see if that is true or not. We can talk more about the Fed incoming uh potential Fed governor. But um you know the market uh the situation with regards to things that that cause markets maybe to have a certain amount of longevity in their movement uh seem to be on the right track and and that's the economy and that's earnings. And the technical indicators have largely, you know, breth is at its highest level we've seen in the last couple years with regards to, you know, some of the Russell 3000 data that look at just broader base gauges of uh of breath that have been pretty impressive. Now, we we didn't truly get the breath thrust that I think a lot of people were hoping for, these big 90% up days where all the volume is on the upside. And that happened last year in in April, of course, but that also followed a 20% decline, not a 9% decline. So, there was a lot about this little pullback, if you want to call it that, that that really fit in with sort of a garden variety correction. uh and and very similar to last year was resolved by a V-shaped recovery in a way that I think is pretty convincing. Uh if you look at past examples in history of when these kind of things have happened, like what happens to markets when they go up 3% each of the last 3 weeks, well historically the record is very very bullish over the next three to six months. They don't go straight down and and that's obviously ignoring everything that's happening in the Middle East. But to to the same point uh you know if the fundamentals and the technicals are both pointing uh positively then I will take that nine times out of 10 versus you know thinking that maybe there's some other narrative that's going to cause a big sell-off or a big recession in ways that I don't understand and really can't quantitatively measure.

side of the road nine times out of 10 and and and help you in terms of managing your own risk and and strip emotion out of the equation. I think it's uh hugely important for investors to to take advantage of.

These these things aren't stochastic where they're all over the map and you don't know and oh the technicals aren't working and things are very methodical and and trends are very much in place up down and sideways and uh there are ways of analyzing it and and you know making profitable forecasts and and you know knowing to get out right away when those don't materialize. And that's the whole name of the game is cutting your losses when you're wrong. And if you do that, then you can be wrong seven times out of 10 and still make a phenomenal amount of money because the at times that you're right, you double and triple your position and you make your entire year. And and a famous guy by the name of Steve Cohen said that from SACE now 72 that you know it's it's not really a matter of uh you know always wondering whether you're right or wrong. It's always risk management that that rules the day and and not being afraid to uh push positions when you're right and uh so that's Ducken Miller that said that part.

Okay. Well, definitely very smart, very successful investors. Okay. So, if we can let's go into the lightning round about what your uh models uh your TA is telling you about certain asset classes. Um we talked about bond bond yields very generally. Um, private credit is in the headlines a lot right now. Question for you is, um, what impact, if any, do you expect private credit to have on the bond market over, let's just say, the next quarter or two?

>> Yeah, very tricky only because there's not a lot of ways that I know how to really quantitatively look at that. I mean I I do look at relationships between investment grade and junk bonds and I think that in general the response of the bond market has been quite tepid as to what is happening. I mean certainly parts of technology you started to see you know some of the CDS went a little haywire for a minute but in general when you look at things like you know the options adjusted spread the uh OAS or just the the ratio or the spread between junk and and investment grade I mean to be 450 basis points above treasuries is really not all that important almost every larger bare market has been usually steered by the bond market initially and what's happening with uh credit either going AR in some way or or you know some type of distress and and that largely did not happen. This is a supply shock only and really nothing with regards to and and not to make light of the private credit wos but I haven't seen it affect the bond market in ways that normally I would use to say this can be a problem.

>> Okay. So, um, you're not seeing private credit right now is looking like a big threat. You know, obviously you can update that, but right now it's not keeping you up at night.

>> That's right.

>> Okay.

>> Nothing, by the way, ever keeps me up at night, Adam. So, you should know that.

>> Oh, I'm very envious of um All right. Well, let's go to stocks because you talked about stocks uh generally. Um so you've given us uh your your your thoughts on the general market which are um positive. Um you know you talked about certainly looks like the bottom the market bottomed. It's super you know momentum's been really strong. Breath has been looking good for all the reasons you mentioned. Um you expect it to end higher this year um with a bit of a pullback coming in the next month or two but then a pretty strong summer. All right. So that's sort of the general indices. Um, are there sectors in there that you're particularly bullish about or particularly wary of right now?

>> Yeah, I think the next three months has massive outperformance in technology honestly because it's underperformed for such a long period of time and and most fundamental guys would tell you that that many tech stocks have become just outright cheap. So tech has begun.

>> Is this all tech is is it mostly the mag 7 or is this also the software?

>> Now look, obviously parts of the memory space and the opticals, they've they've remained at new highs and and many semis have snapped back in pretty resilient fashion. So yeah, it's more about the mag 7 have gotten uh you know back to very reasonable uh levels with regards to valuation and obviously software software I would caution that it it's it's tricky to buy something down 20 30 40% and expect immediate mean reversion. That takes time. So, it's normally a two steps forward, one step back type process, and I think this will be no different. So, I I completely support the idea of buying stocks like Microsoft and Oracle if you're going to hold them to 2028. Uh if you have a one or two month time frame, then you know, it could still be a little choppy to say the least. Uh so, to get back, technology, I like, industrials, I like, financials, I like those are my top three. Uh I don't care as much about discretionary that has begun to to move uh you know rally a little bit but I'm I'm less uh you know keen on on putting really actionable money to work in uh in discretionary. What's what's bad is right now most of the defensive sectors are really being hard hit. utilities just in the last week or two has really started to show relative weakness and so maybe that would be sniffing out uh you know long rates starting to to lift a little bit I don't know but groups like healthcare have been out of favor I see healthc care as probably being the second to energy probably the best of the defensive sectors and then utilities reach staples telecom are are really uninvestable at least if you hope to outperform in the short Now that could certainly change but for the time being that's what the near-term sector trends are showing if you're invest in healthcare and parts of it are actually quite good like biotechnology is phenomenal but other areas like medtech and >> healthcare services and uh you know pharma has taken a backseat to biotech and I I wrote a little bit about that uh last night actually.

So, okay. Um, you you mentioned earlier, by the way, this is super helpful, so thank you. Um, you mentioned earlier something that I've I've heard echoed by some other folks I've interviewed um, this year that earnings estimates uh, keep getting ratcheted up and uh, and they've they've been getting ratcheted up this year at a faster rate than going into this year and that's through the war. Um, so the war definitely doesn't seem to be weighing on analysts um, optimism about the future here. And it seems to me like one of the benefits to the equity market moving on from here is that um, it may get the tailwind of rising E right in the PE ratio, right? Rising earnings estimates. Um, but now you're saying here in the near term it might get um some tailwinds from a rising P or the multiple right so multiples got depressed over the past two months or so. Um now they're starting to recover while the E continues to grow. So I mean this is a pretty nice setup. It sounds like

>> I think the earnings have kicked off and have been much better than anticipated. Uh with regards to technology, you have seen uh companies like you know Micron Technology and SanDisk in particular the the earnings uh increase has been so dramatic with ease that they have affected almost the entire technology sector and a lot of it has been pretty concentrated but it's still something that's moving higher and something that I think investors really want to pay attention to. So yeah.

>> Okay. Um, and part of the reason why I asked this too is is, you know, coming into the year the administration was saying, "Look, we did a lot of work last year. It's really going to start paying off. Golden Age of America is going to kick off in earnest. You're all going to see it real soon. It's going to start with the tax, the record tax refunds." Um, and then we had the war happen and oil prices went up and everybody has been understandably very concerned. Um, but I've talked like I recently just released a a video with um the CEO of Freight Waves who you know tracks global transport and when I talked to him at the end of last year he was I mean I thought he was going to put his head in the oven. I mean he was really despondent about the what was going on in the industry. Now he's singing a completely different tune. Says bullish as ever been. Says that the industrial America's industrial economy and manufacturing economy are booming right now. he doesn't see that slowing down at all. Um the war, believe it or not, is actually not only not affecting it, but in some ways actually adding tailwinds to it. Um so, you know, my question for you just real quick here on the economy is what are your thoughts on the US economy this year?

>> I think the economy will hold up. I I'm not an economist by trade, but I I think that uh my my only worry is that long-term rates go up in a way that will uh really hurt u you know certainly housing. You certainly feel that there is almost always a K-shaped economy that develops whenever you have true freedom in markets and when you allow you know in terms of uh how do I describe how do I explain this the best way I guess uh yeah look in general when you have a huge real estate boom like we've had in the stock market boom uh certainly those on the the uh the upper end will always prosper by that whereas those uh that do not own assets like that will not prosper and it's proper to uh hear both sides of the equation and and not uh neglect any arguments on either side. Uh but I think that uh you know I tend to be uh optimistic that we're not going into a recession and that that probably is not anything that will happen until 2028 2029. And that's largely because I think real estate will be pulling back and that's one of the main things I look at. Um we have to look at the potential of a grand deal being carved out with China. We haven't really talked about that. That could happen literally in a month. and the fact that we've not only gone into the war and also went in and removed Maduro very quickly. A lot of that is uh due to uh you know take make China come to the bargaining table. We need their rare earths and they have a very big need for energy as does most of Europe right now that is dependent in ways that uh they've never been before. So the US definitely comes out ahead in in that uh department you know with our own energy infrastructure and and uh onshoring manufacturing. I mean those are certainly things that are positive. It's obviously negatives and we can it's whether you decide to to choose to harp on the negative or try to see the positive. You know you look through the lens and there's certainly a lot of good things that are happening but there's also things that are a concern and and uh you know can't be overlooked also. So, but I I tend to be an optimist with regards to the economy and the stock market this year. So, I have to think that it won't be any major uh uh you know blow at this point.

Okay. So, the reason why I was kind of digging here is um again it sounds like your general advice to the people who are concerned about what's going on right now particularly with the war is um take a beat. Like there's there's there's enough positive things going on. um both with the markets and the economy that you expect markets to be higher by the end of the year despite having volatility and you don't expect a recession this year. Now, obviously that could change if things, you know, really go south with the war and oil prices go higher for longer. I mean, all that stuff could eventually force you to change your opinion, but right now, based upon what you're looking at, um base case, no recession, base case, no bare market.

I always think it's proper to separate uh investors thoughts on any event that's happening from what's happening in the stock market. Those are two separate things. Investors would be wise to uh you know put on put in the earplugs and uh you know honestly not pay attention to what's happening because it rarely uh impacts the market in a way that u emotionally it makes you feel like it should. Okay. And so that's always been the case since the beginning of time. Uh unless the market vastly underestimates what's happening and it's such a huge negative that uh there's a big shock and arguably that didn't really happen uh in a way that would affect the stock market this time around. So I I sense that never wrong to be concerned about things in the world. I think it's great to talk about things and try to make them better. I I just think that most people would be wise not to uh always listen to the the news sources that that might try to paint a world of negativity when there's still a lot of things that are going on that are right in the world, you know, and a lot of things moving in the right direction. So, it's all depending on how you want to feel when you get out of bed in the morning. And some people choose to be happy and focus on the glass half full and others uh, you know, say, "Well, this can be wrong and this can be wrong." And they're not wrong, but it's just, you know, it how will those affect your portfolio? It's almost always proper to just really try to separate that from what's happening in the stock market.

>> Yeah. No, you do a really good job of saying be a Vulcan. And uh you know, your your approach is not only to be a Vulcan, but to be a Vulcan that >> basically reacts to what the data is telling you, you know, the data, your your technical analysis. And it seems real clear right now. You are positioned for optimism, not raging optimism, but you're positioned for optimism versus pessimism. The cycles can also tell us in advance as to what's happening too. As you talked about earlier in the interview, I mean, a lot of my stuff said the market turns. That wasn't based on anything in the past. That was based on what could happen in the future. But energy gave us a very clear buy signal back in December as to what was going on. And crude oil started to lift for reasons that many didn't understand that when uh and then the war finally started and it all made sense. But um yeah.

>> Do you do you think that was sniffing out the war? Is that your opinion?

>> Uh the extent of the move from the lows was very dramatic and happened uh at least about a month and a half ahead of when the conflict started. So

>> um

>> I had my own reasons based on cycles that suggested crude oil would go up meaningfully this year and and I think I shared those with you. If not, then I'm happy to share the cycle that I looked at. But it uh it pointed crude. I went overweight energy for the first time in years after being underweight and it's been negative. And uh I guess one thing I didn't do was to overweight materials like Tom Lee did. So to his credit, but I uh I most of my stuff did not show materials moving up as fast, but you know, both of them ended up moving in tandem. Now energy is dropping, materials are still sort of holding up. So

>> Okay. But I'm just going to ask my question one more time and then we'll move on. Um because I do want to ask you specifically about where you think energy stocks are going from here. But do you think that the Iran war was just coincident with this cycle that your your trend analysis was predicting or do you think it was actually causal? um

>> the cycle started because it was it sniffed out the

>> word the long-term cycles and that's a whole different conversation of some esoteric things that we won't get into that that suggested that you know there's an 84year cycle of uh of war with regards to the United States that happened in 1942 it happened back in you know 1860 the old for turning thing yeah audience very familiar with that

>> that's an 84 year return where it suggested the US could involved in conflict and and here again it it materialized. So it's not I'm not taking credit for that but I study the cycles. I watch what's going on at crude and and these things happen and uh people are shocked but honestly a lot of this stuff uh if you take the time to study history uh you know makes some sense.

>> Okay. All right. Um, so you you said earlier when we were talking through stocks that um uh well that that energy may still have some life left in it, but um it was sort of an offhand reference. So I'd like you to clarify what are you expecting from the energy sector and and maybe if you want to parse it like oh I like nuclear but I think gas is going to sell off or whatever. Go for it. I I think that energy is still in the midst of a pretty uh violent short-term decline. I don't know that that's over yet. My own thinking is that crude probably gets down to under $60, which might shock people. But I think that crude has already fallen a good amount and the straight is not even open. And so when it actually we do reach an agreement, I think we'll see that fall much further. Uh I do sense that's temporary. I think the oil market did in fact establish its uh an end to the bare market that lasted since I guess 2022. And so I think this was the first big huge sharp move off the lows and now we're seeing the consolidation. So when that's over then I think energy will start to be attractive again for investments. it had such a huge lead over every other sector being up 30 plus% on the year that it's natural to see it sort of give back a little and and you know it's it's sort of a a challenging sector in the short run. Yeah, I do respect the the nuclear end of that energy. I think uh you know there it's tricky parts of alternative energy still really aren't working all that well. uh you know it's going to take some time. Um I natural gas I'm not as fond of but except for I guess European natural gas which I think is going to be very much in need by the fall to your earlier point. So for those that want to buy gas type uh you know I think that the TTF uh makes more sense and looking at Henry Hub for natural gas.

>> Okay. Um and then precious metals. So they've gone through a pretty big correction. um particularly silver since we last talked. Um I think that was one of the easier calls to make because when you and I were talking uh that was I mean silver was like pushing 120. The price action had just gone vertical. Um is the sell-off over or do you expect continued weakness? What what are your what are your models saying?

>> I'm viewing the metals honestly very similar to what I'm viewing the stock market and I think we'll probably have a dip in May and that's going to be something to buy into. And I sense between May and uh the month of October that we can have a final push back to new highs in the metals across the board. And that means not only precious metals, but honestly what's going on in copper is very impressive. We're seeing all types of bullish fundamental news coming out of China and huge source of demand. I think copper is going to have a phenomenal year, but you know, copper has underperformed gold for so long. Uh we need to see some evidence of that shifting. I like silver. I like gold between now and the fall, but it's not going to be an easy ride. I think gold initially probably will stop around 5,000 area and we'll need to consolidate, which means we probably give back about half of what we've done since the latter part of March. So, the metal is largely bottom near where stocks did and we had a pretty decent push up and now we're getting towards the first target, which I think probably happens within the next couple weeks. Thereafter, we sell off and you really want to buy dips. We still have a lot in place that favors the the metals. My only worry intermediate term is that we've just gotten very very overbought and we're also very late in the cycle in the stage. So I sense that metals probably peak out for good uh probably this fall and probably have a another couple year bare market. And I think that happens as rates start to gradually uh go higher. And I think that in general real rates pushing up are going to be negative for precious metals. And and uh we shall see. I think it's still with regards to Fed independence and the deficit and all that's a huge driver and central bank buying some of that did in fact stop a little and slow and so uh you know we finally got a big pullback and now we've had a first sort of rally off the lows and it's been a pretty decent rally enough that I sort of want to be invested I think uh over the next six months but thereafter I I think it's going to be a tricky uh I think it's going to be tricky for the medals.

>> Okay. Um by the way this detail in your forecast is just greatly appreciated. Um commodities uh but the softs like agriculture. Um any particular opinion?

>> I I love agriculture commodities this year. Uh they're in a year when they should experience a uh a year very similar to 2020 and have a very big rise. So yeah, I love

>> Were you thinking this before the war? Just to be clear,

>> the cycles uh showed that this year should be a year of gains and that happened uh very much before the war. Uh yeah, so it's uh you know, anybody that looks at these same cycles will come to that conclusion. It just so happened that oh by the way, now we have a reason. So yeah, I think the the food is a bigger area of concern that you can't just shut down right away. The longer the streets close, it's going to be a real crisis, I think. And but it's you know, it's going to be good for the grains. It's going to be good for a and fertilizer stocks. Like I added Bungie to my Uptix list, which is a list I run of my technical favorites. And uh stocks like CF Industries and Bungie are great as well as the AGS. They should do well.

>> All right. And then the last sector, um at least last sector that's coming to my mind, feel free to add any others you care a lot about. Um but Bitcoin, do you track that?

>> I do. your partner does, but

>> yeah, I I I came in at the beginning of the year not to uh take a victory lap. I think the year is obviously just getting going, but but uh I suggested Bitcoin to fall to 60,000. I now have sort of lowered that target. I think that uh the lows are not in for crypto and uh we are going to pull back to new lows likely into May. I think Bitcoin gets to 52,000. Um you know, it's tricky. We're in a four-year bare market for uh you know the cycle of the crypto winner which happened in 2022, 2018, 2014. So uh the sell-off didn't surprise me. It's more just the uh you know I I still sense that there isn't realistic reasons why crypto should be rising right now. Uh the infrastructure doesn't seem to be in place. It doesn't seem to be real buying and the structure of the whole move off the lows is still very negative. So it's very choppy overlapping. It's very much sort of a corrective move that I think honestly in the last week we've peaked and I think we're actually going to start to fall pretty rapidly in the next month. So that's a move I would buy into. I'm actually positive for the the year, but I think that uh this spring is going to be one where uh crypto needs to get to new lows first and thereafter we can finally uh you know experience a pretty good move. Now, normally, you know, most of these bare markets last at least a year, which means October of last year is when we peaked. October of this year, we bottom. Uh, that would make perfect sense to maybe establish a higher low. So, we have a sharp rally maybe between, let's say, June and uh the fall and then we pull back probably to a higher low and bottom in October, November, and then we can probably rally with everything I think into 2027.

>> Okay, great. Um, so just to be clear, it doesn't sound like you're c even though we expect um a recovery from a bottom, you know, somewhere in the next couple months, you're not expecting new highs in Bitcoin this year.

>> Yeah, that's tricky only because um, you know, I sense that the fall can still bring some issues for both for equities and for crypto. So, I'd be more comfortable with saying depending on where they are by the month of October, uh, you know, in general, I think that the bottom of the year very well could be made in the next one or two months for for crypto. I think it's probably going to happen, but but it needs to start to move down quickly, and I think that's something that investors should watch carefully. That happens into uh mid to late May, that should be a very good time to to buy dips in crypto. Finally, uh I sense that any move to new lows is really going to shake people out who are really hopeful that okay, equities are moving up, crypto should move up and

>> y

>> I sense that, you know, both can consolidate. The move in crypto should be a lot more severe and that's going to that's going to flush people out likely at the lows which will be a great buying opportunity for 2026.

>> Okay. All right. Mark, this has just again been wonderful. Thank you so much for this. Um, and folks, um, I'm gonna tell you in a second where to go to follow Mark in between now and his next time, but Mark will be back on next quarter to give us an update on where we are in this. We are we where we are in all of this. And I mean, I know you're painting with um the finest brush you can, but it's still a fairly broad brush. Um, but if if your expectations are correct, we should probably be through the correction um that you're expecting and then poised to kind of have a really strong summer. So, the timing of your next uh appearance, Mark's going to be really, really interesting. Um, okay, Mark. So, for folks that would like to follow you and your work in between now and then, where should they go?

>> So, I have uh let's see, a couple different things that I could share. Um, let's see. I do have a I guess a QR code that I could uh you know why don't I do this? Why don't I send it to you and you can you can add it to your to this at the end. I would I would say you go to funstratirect.com. That's our retail arm of Fundstrat. That's where if you're a retail investor, you can subscribe to notes of people like myself and Tom Lee and our crypto department and our policy guy. Uh funstrat.com is for institutions. If you're an RAA or an institution, you uh you know, you want to have face tof face meetings, uh we certainly do a lot of zooms every day with institutions. Um you know, that's how you reach out to us uh there. Uh I am on X at Mark Newton CMT and so you can follow me there. But generally uh you know, I'm happy to extend uh an offer to come and and view our research at least for a two-eek trial and and you know, you can sort of check it all out and see what happens. We have a new app which is pretty neat where we give sort of intraday type messages and you see everything sort of live as it happens and it's uh it's it's pretty remarkable. A lot of people have given us some good and we actually have a brand new AI product that we're starting where we can whitelist things if you're an RA and you create uh you know reports that you can basically you know whitelist as your own and and give to clients and share with that as well. So and we also have three new ETFs and and

>> geez you got a lot going on. All right. Well,

>> our Granny ETF is up to uh about close to $4 billion in about 16 months. So, uh GRNY, which is uh modeled after the Granny shot from uh uh we won't we won't get into the nuts and bolts of of all that right now, but but in general, we have a uh three ETFs that you might want to explore. One is a small to midcap ETF. One is more of an income generation where it's designed to uh give you about a 10% yield and the other is just based on Tom Lee's methodology uh called granny shots. And so uh the three of those are about 4.5 right now billion and very happy that they've uh succeeded and done well.

>> That's fantastic. Um and I love the fact that you named Granny after Rick Barry with his grани. Many many don't know that he taught that to Will Chamberlain and he scored 100 points in the next game and that a lot of that was due to the granny shot. And so uh you know the thinking being that you invest in all these companies and they hit on a bunch of different buckets and it raises the probability hopefully for success and so uh yeah it's a cute name and it has a good story.

>> Yeah. Um I want to expound on that in just a second but so that I'm going to put the ETF tickers up. That's why I'm asking for this. So GRNY is the one for that one. What are the other two tickers? GRN II.

>> And which ETF is that one again?

>> That's the income. And then GRNJ is the small to midcap.

>> Okay, great.

>> And that's based on the same philosophy. It's just small to midcap companies. And so, you know, it's nice to be able to cover the spectrum. And uh if people feel defensive, they can buy the income or just the regular granny. Uh it's been I I don't want to boast about the outperformance, but uh you know, it has outperformed since inception. It's been uh remarkable. So very happy.

>> Okay. Um the the thing I'm going to say about the granny shot um it's it's germanine to our earlier conversation kind of about people's investors emotions oftentimes being their worst enemies. Real quick um I'll I'll put up the QR code earlier um if you send it to me but but clicking on that QR code or you know snapping it with your camera uh lens. Um where's that going to take you? Is that going to take

>> I believe that will take you to an area where you can sign up for a twoe trial. That's my understanding. Uh I was just sent this about 20 minutes ago. So, uh I do have the the QR uh you know and it just I you know I'd recommend you just go and explore the the website itself. Just go to funstrat.com and go to funstrat direct and and there's a lot going on there. So very happy to uh you know to to share our research with you and have you see what we're all about.

>> Okay, great. Um, so, uh, just in wrapping up here on this this whole brick berry thing. Um, so I've I've talked about this before in this channel and I'll I'll just give the super quick summary of it. And folks, if you've heard me say this before, I apologize. Um, but, um, so yeah, Will Chamberlain is famous for that 100point game, right? And um this the season he hit it uh was the season that so so he was a terrible free throw shooter >> and he was a liability uh to his team because in the last couple minutes of the game well what would you do if Wilt got the ball? You would foul him. He'd go to the foul line. He'd missed. You'd get the ball back and another chance to score, right? So um the I think the coaches there said, "Hey, look, Will, you got to you got to shore up this weakness." and they got Rick Barry to come uh and struck him on the granny shot and and Wilt's field goal percentage went way up and and folks don't realize this, but in that 100point game, he had like a careerhigh from the foul line. It was like 80 something%. Right? So, it was actually really material in helping him hit that that that scoring record he's he's so famous for. Um and uh you know he had a pretty good year uh in in in that year, but then he stopped doing the granny shot and uh his free throw percentage went to an all-time career low. Um you know, the the hey, let's foul Wilt thing came back in. And in his memoir, he basically wrote about it with regret, saying, "I I I I should have stuck with it." He said, "The problem was I just felt too much like a and it it was totally emotions that got in the way."

>> It's not macho to be able have to do a rant. Yeah, I understand.

>> Right. Right. It's not It's not macho, but when you think about it, like, think about the the career stats of his that suffered. Think about the points that weren't made, the games that weren't won, right? The the the economic opportunity cost of that to him and his teammates. Um, and and what's so crazy about this is in the decades since pretty much nobody in the NBA went back to the granny shot. The only player who I don't know if he's still playing now, but the only player who recently in the NBA who was shooting the Granny shot,

>> Rick Barry's son.

>> Oh, okay.

>> Yeah. And uh

>> Shaquille O'Neal, maybe he could have benefited from that.

>> You certainly could have, right? And but that's the point. It's like there is like gold nuggets on the ground there that these guys are just choosing not to pick up for an ego reason, right? And and it just shows how often times our emotions can influence to do things that aren't in our best interest. And same thing can happen with investors. And again, Mark, I just want to underscore why your Vulcan very technical approach really helps insulate from from that risk.

>> Thank you. Yeah. Don't don't have an ego. choose fun strat and we'll hopefully help you to get there to the finish line. So, thank you.

>> All right. Well, look, Mark, um when I edit this, I will put up the links to everything we talked about. Folks, the links will be in the description below this video as well. Um and if you are someone who, you know, would like to apply in your uh your portfolio management, a lot of the things that Mark and I have talked about here, but you don't want to be your own financial quarterback. You have a life. You want to focus on the things that you're great at like maybe earning income but um farming out the actual management to a manager that you know could benefit you way benefit you in the way that Mark benefits um the folks that follow his funds. Um then highly recommend you get that help from a good quality professional financial adviser. Importantly one that takes into consideration all the the concepts that Mark and I have talked about here. If you've got a good one who's advising you on that great don't mess with success. But if you don't, feel free to talk to one of the adviserss that thoughtful money endorses. These are the firms you see with me on this channel week in and week out uh to schedule one of those free consultations with them. Just fill out the very short form at thoughtfulmoney.com. Only takes you a couple seconds. Again, they're totally free. No commitments involved. It's just a free service these firms offer to be as helpful to as many investors as they can be. Um Mark, thanks so much, buddy. Really look forward to doing this in a quarter with you.

>> If we can, let's just 20 seconds. any parting bits of advice to investors as they navigate, you know, what is arguably emotionally a challenging time in the markets right now?

>> Yeah, look, I think it's it's honestly it's really important that investors just start to become comfortable with looking at at at charts and and and gradually teaching yourself how to sort of marry uh what's actually happening in the price action with what you think and and hopefully the two will be on the same page. But it's great for risk management. I always endorse it. Uh bottom line, you have to ignore as much as it it pains anybody to do it. We're all delued by news every day, but you have to just try to focus on on really what matters. And uh for the stock market, it's it's not necessarily all the news that matters. It's really uh what's happening with you know trends and volume and the buying and selling and and uh you know what what's happening with momentum and sector leadership and uh interest rates and the dollar and uh expectations much more than uh than uh all the negative news.

>> All right. So listen to what the market is saying not what the pundits are saying.

>> That's exactly right. Yeah.

>> All right. Thanks so much Mark. Very much appreciate look forward to seeing you next time. And everybody else thanks so much for watching.

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Market To Pullback By May, Then Race To New Summer Highs | Mark Newton @Fundstrat_Direct

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