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Well, I think the next two months are going to be a lot choppier and I do sense that we could have a 5% uh maybe 10%, but I think at least 5% move probably starts in October into November. Uh at that time, I think you do want to buy dips and I think the market likely goes higher into year end if not probably the middle part of January. I I do suspect that heading into next year, if we finish on a high note, that we probably will have a first year correction. [Music] Welcome to Thoughtful Money. I'm its founder and your host, Adam Tagert. When today's guest was last on this program back in May, he made the bold prediction that new all-time highs for the stock market were just weeks away. And he was right. And since then, markets have continued powering higher, trading at a new all-time high the day of this recording. So, is he still bullish on the market's prospects for the remainder of the year? 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. Thank you for having me back, Adam. Great to be here. Thank you. Um, well, look, first and foremost, congratulations on the correct call, uh, that I just mentioned there in the intro. Um, you know, at the time, um, wasn't, you know, a crowded call, uh, and you kind of stuck your neck out there based on your technicals. You're you're a big technical guy. Uh, and you were proven right. So, I want to give credit where credit's due. Great. Thank you. All right. Um, I got a number of questions for you, but I'm just going to start with the money one, which is, uh, as I mentioned, you're a technician. Last time we talked, I really got from you that you you take macro into account. You think about all this stuff, but really at the end of the day, you just do uh what the market technicals are telling you to do. So, what are your latest technicals telling you in this market? It's been an interesting month or two, I would say, for the US stock market. Um you know looking at the market back in April and really in May when we spoke there was still rampant signs of fear um the fact that technology had come back with a vengeance really gave a lot of confidence to the idea that markets should start to turn uh higher. I mean sentiment at that time had gotten almost as bearish as what we saw at the uh 2022 low as well as at the COVID low back in March of 2020. And going past that, it would be almost, you know, 2002, 2003. And so there's only a couple times in the last 20 years where sentiment had truly gotten that negative. Um, fast forward to today, uh, sentiment has improved ever so slightly, but but still largely neutral and arguably still not as optimistic as what many would want to see to to think there's going to be any sort of major top right away. And and sorry Mark, are you talking consumer sentiment like the um missish surveys? Are you talking investor sentiment? What what are you looking I I look at a combination of those. Obviously we've done some studies on on the missish survey and when you look at consumer sentiment uh you know there is some political bias to that and that has been pretty chronically uh negative compared to how it looks over the last 20 years. But but I look at a combination of several things on the retail side like um American u Association for you know investors intelligence um AI I think is is interesting at extremes. I think the fear and greed poll is very very good. I look at sort of the slope of the VIX curve. Uh I always want to look on the institutional side for what the CTA exposure and some of the really the short interest as a percentage of open interest. um what's happening with Bank of America portfolio manager surveys. I look at a JP Morgan poll uh I try to put it all together and just also looking at option skew and so you know I I don't see evidence of rampant speculation right now andor evidence of real froth with regards to sentiment. I I think that obviously under this administration there's sort of a new ballgame with regards to how we view sentiment. I think a lot of people remain largely pretty guarded and fearful of tariffs and what's going to happen to inflation. I think a lot of that really has not mattered to earnings nor uh economic data. You could argue that, you know, potentially the economy is starting to show evidence of rolling over ever so slightly on the fringes. Um, obviously the labor market has been weakening of late. People have stopped hiring, but yet we don't see mass layoffs. Uh, the data today on continuing claims and jobless claims was actually pretty encouraging. So, I would have to argue and and the Fed obviously has has still indicated they're set to really cut into this economy. Uh, you know, to the tune of about four cuts by next summer. So, you know, it's an interesting spot we're in where earnings are very, very good. The market's hitting new all-time highs, but yet the Fed's going to cut, you know, two more times potentially by the end of year and another two times between now and next summer, between beginning of year and next summer. Um, you know, technically how I look at things, I I I look at things like momentum, breadth, obviously technical trends right now, those are still quite strong. uh there have been some a little bit of breadth rolling over in the last two months. It is important to note that because the market largely is unchanged on an equated basis since late July. So it has been technology and communication services that have done a lot of the heavy lifting of late. uh some of the companies within data storage you know the western digitals and seaggates of the world have really helped to drive technology whereas you know the former leaders like Nvidia have been rangebound since July so th those are no longer you know at least the area that that's helping to lead the market and it's still you know 7 and a half 8% of the S&P so you know for me it is encouraging to see other areas within technology start to rise and take the lead there's been a little bit of bifurcation there but but tech uh does have the power to take the market higher regardless of nothing else is participating. Uh in this case there have been other things that have made slight progress but that's one thing I'm watching that might be a uh to some extent a minor warning sign over the next two months was that the breadth has started to falter ever so slightly. Um we've also gotten technically you know how people like to say overbought. So when I look at relative strength index on a daily basis, on a weekly basis, we're now officially in overbought territory. Um you know, we're pressing up towards the highs of the multimonth uptrend channel that that goes back since the spring and that hits up near 6720 or so for the S&P. So my own view is that the upside uh should be a little bit limited over the next few weeks. I I think that we are getting into a seasonal time where cycles and seasonality uh are going to put a downward bias in this market. But I'm still really premature at trying to make any sort of short call or time to raise cash. I think that you know the movement in tech has been strong. My own view is that uh that happens sometime in the month of October and midocctober which would be in a six-month window from where we bottomed. and my own cycles say between midocctober and mid November is the key time for weakness in the stock market this year. So if I had to look over the next two months I say there's a good likelihood that markets will be down but I don't think the next u probably two or three weeks are going to be down. I still think we're probably going to find a way to push higher into October before we see any type of uh even a mild pullback. And so, you know, looking all in all at all my indicators, uh, momentum, uh, is still strong, technical trends are strong, trends are really the most important thing. And when I look under the hood at sector rotation, having technology lead the market yet again, uh, is a good sign. Uh, sentiment also from a contrarian perspective is also a good sign because we've not gotten uh, terribly, you know, enthusiastic. I I say the one thing that you could say uh in the the bear's favor here is that you have started to see evidence of uh you know some of the meme stock speculation and this and that uh ever so slowly starting to lift. you obviously see a very good move in small caps. Uh I would not argue that's um you know a sign of true speculation, but we have you know interest rates now coming down. And so obviously these smaller capitalization companies that have a much higher ratio of debt to capitalization uh certainly benefit with floating rate, you know, corporate structures as rates come down. Um, and so small caps kicking into the gear along with midcaps is is definitely a good sign for the stock market at large. The times I worry were like 2021 when I turned bearish in November of that year and in January expecting a 20% sell-off was that market breath had really begun to roll over and it was really only technology that was participating. So far fewer stocks above their 200 day moving average so to speak and sentiment had gotten very very optimistic into end of year really November December of 2021. Um that's typically what I look at to say okay markets are really really getting vulnerable uh for now with rates coming down sharply on the long end and and still the short end. I guess the yield curve has started to steepen out ever so slightly again. Um, you know, I see that as being a force of of good news for home builders, for those seeking to refinance mortgages, and I think that that um, you know, we shall see if that can truly help to stabilize the housing market, which uh, my own cycles say should be due to peak as of next year and go into about a two-year decline. Now, we've already started to see housing in many parts of the country start to stall out and certainly supply has been elevated. homing, you know, homes have gotten to really unsustainable uh I would say uh prices and the interest rates have now largely doubled with regards to mortgage rates over the last two years. There's a reason why my wife and I actually sold our house last August. Um but the Northeast where I live has not really felt the burden of that like the most of the country. And so we have not enjoyed the same kind of appreciation on the upside and and I would argue we probably also don't see the kind of decline in home prices. But arguably if if if rates are going to start to come down in earnest, uh we know on the short end they're going to take rates down. But really the question is whether the economy is going to really start to roll over and weaken substantially and or if inflation is just going to continue to prove to be a non-event. Um my own forecast for rates is that we're going to continue to fall between now and end of year before a pretty good bounce in both rates and the US dollar. Um, for now the dollar pulling back, rates pulling back, uh, arguably still quite bullish for equity prices, uh, as well as for asset prices in general. Emerging markets have thrived. We've seen precious metals. I know you're a big silver bull. I own some silver and gold as well. That has done quite well. So, crypto has done well. You know, I just sort of struggle. I I I sense that we are sort of nearing a time when we could be nearing uh a short-term inflection point, but but we have just yet to see any real trend deterioration. And I have to sort of lean on long-term trends as well as short-term trends and say until that happens, you know, I feel like the S&P probably still has another 75 to 100 points higher and then I feel we're probably going to have to consolidate this move in in October. Okay. Um thank you. So, just want to confirm a couple things. Sounds like you're saying um you you have some some uh immediate term this market can still go higher. Um but as we head into October, November, it sounds like your default is uh assumption is that um things are going to cool off a bit in the markets. Um I don't get the sense that you're calling for like a 20% kind of correction like you were heading into end of 2021. uh because the the froth isn't there in the way that you saw back then. Um and uh I'm not quite sure how I would consider your outlook for say the year of 2026. And maybe you're not looking out that far anyways. I don't know. Um, I I think that uh I'm going to save a lot of that commentary for probably year end when I do my my annual review, but I'll just say that a market that's up uh largely 20% for two years straight and if we finish this year near our highs uh will have to undergo some consolidation. We're really nearing the end of that four-year cycle. And of course, we did see pullback in 2022 and to some extent in 2018 and at least some choppiness in 2014 and this and that. So I I think that u I I do suspect that heading into next year if we finish on a high note that we probably will have a firstear correction. uh I'm sort of unwilling to say that we're going to go down in a big bare market and things are going to get really tough and and a lot of that just has to do with intermediate term uh you know strength in in AI which obviously is something we still have to respect with regards to earning strength and also just technical strength and and many of these companies continue to impress um on the upside. So, you know, to to to look at it overall, you know, I came into the year last January with a target of 6650 and we're largely right here, of course, with about 3 months to go. Um, what does that mean for now until year end? Well, I think the next two months are going to be a lot choppier and I do sense that we could have a 5% uh maybe 10%, but I think at least 5% move probably starts in October into November. Uh, at that time I think you do want to buy dips and I think the market likely goes higher into year end if not probably the middle part of January. And when that happens, if the S&P gets up close to near 7,000, uh, you know, I I sense that we'll probably see some real enthusiasm for the stock market and just think, well, everything we thought we knew about how tariffs would work or about how Trump would work as president is just about him being bearish and it's the end of the world. all this stuff is going to prove to be wrong and we're all in now on stocks and I think that's probably a time to worry is probably the beginning of next year versus uh right now. So, uh I I'll believe it when I see it. I mean, to start to see evidence of real technical price weakness is really the first thing that, you know, people like myself want to see. And uh until then, you know, we just sort of have to lean on the fact that u you know, earnings continue to beat a very low bar and are coming in better than expected and the economy is still holding up better than many expected. And you know, technically we're in a bit of a uh an upward, you know, melt as they say. You know, we're we're largely have been melting up since the beginning of September. we've we've ignored a lot of the seasonal weakness that we usually see in in August and or September in election years and I had written that you know if things are going to happen it probably starts sometime in mid August and churns and then we push higher and while I didn't turn bearish I have been a little bit defensive in the last few weeks and just noting that uh breadth has dropped off and that uh you know we're getting stretched but overall that's not an a time to say to clients, you want to take all your money off the table. It's more just to not, you know, be too late to leave the party and and don't be the one standing next to the punch bowl. And so, you know, I'm I'm bullish, but I yet I'm a little bit more cautious, I guess, from a just a cyclical perspective than the last time we talked because I do still feel like we're, you know, we're in a time when something could happen. But I I sense we're probably a month away and then I think we probably have a draw down into November and you want to buy that and then uh you know I'll I'll leave I guess my 2026 commentary for uh for December. Okay. Um hopefully your schedule allows Mark if it does you to come on this channel at some point in December and share that with us after you've shared it with your Funstrap clients obviously but would love to hear it. Um so couple quick things. Um, one I I I I I want to make sure I didn't misstate. I I know you study the macro environment, but in terms of kind of your market calls, you you base those primarily based off what the technicals are telling you, right? Technical analysis meaning uh you know the study of price action trends, momentum, breadth, uh sector rotation, as well as just seasonality and and cycles and and just really leaning on sentiment and cycles as really being things that are probably the most important for making bigger calls on on on changes of trend when we haven't seen any evidence of the trends doing so. So that that's right. I I don't put much stock in in almost anybody's ability to be able to accurately call uh the economy just given you know the data that we look at that continues to be uh you know backward looking and constant reversions and and just uh I think it's a bit of a mess postcoid in terms of how to accurately get a feel for for what we're seeing but you know the data to me uh and I'm not an economist by any means but you know the GDP has has held up a bit better than expected and uh the inflation u has continued to be sort of pushed off and you know I sense it heading into early next year you could have a small spike but I still see crude pulling back to the low50s and that's not really that's been a force that's really taken a lot of the steam out of the the inflation inflation right yeah so let me ask you this Mark just as an example if if Mark Newton the the man is looking at the jobs market and seeing signs of concern that it's weakening and could get worse. You're not going to let that necessarily influence your trading outlook until and and unless you see the the technical price action start to reflect that, right? Yeah, that's correct. Look, I I always advise clients to put all these extraneous, you know, exogenous factors to the wayside and and and you know, put the blindfold on to what the media is saying andor the economists and and really just concentrate on on trends and the sector rotation and how are stocks doing in your portfolio, what's moving and you know the interest rate market and the dollar. I think that's a lot more important than trying to think that any of us can accurately uh predict what the economy holds uh in the months to come. Okay. All right. Well, then let me ask you just on on sort of technical indicators. Uh this this is a push back that I think maybe some viewers would have to your earlier comment that you say you're not seeing a lot of signs of speculation in the market right now. And I get you're saying kind of relative to where we were at the end of 2021 when everybody was just buying, you know, it was going to be sunshine and rainbows forever, but um as you've mentioned um by lots and lots of indicators um the market seems to be quite overbought shortterm, right? Um well overbought doesn't have anything to do with sentiment, but yeah. No, I Yep. It doesn't. I'm just going to mention a bunch of indicators and I'll let you respond. So market is short-term appears short-term overbought by a lot of indicators. Um just nominally um we have a lot of uh indices and stocks at all-time highs which in and of itself doesn't mean much. If you look at valuation ratios though by a lot of standard valuation ratios in terms of hey how richly priced is this market or not they are quite near or at all-time highs. Um, we've seen some crazy price action of late. Um, I think I've got the company's name right. I think the company, it was a smaller company was MMC or whatever, but they announced that they were going to do a kind of a crypto treasury thing, right? And their stock was up like over 2,000% uh, in a day. We had a massive blue chip tech company, Oracle, give guidance and then basically shoot up by 40% in a matter of hours, right? And to your point, we've seen meme meme stocks begin to come back to life. Spaxs are back. We've seen a lot of uh you know interest in and capital influx into cryptos. So a lot of people see that and say, "Hey, that feels pretty speculative to me." So what would your answer all that be? I think a lot of this has just been recently starting uh with regards to some of this so-called meme stock speculation. I I think um to that point, while some of these have come to life, um you know, crypto is something that many I think still really aren't that comfortable with. If you ask any of your friends, I I have a ton of friends, you know, that that locally and and all, you know, whatever in my area that and still a lot of them don't really own crypto. And so, yeah, I get the fact that a few of these have spiked up dramatically, but uh you know, that's a slow process. That's not something that, uh, I would look at with regards to all-time highs. I I don't see that as being bearish. I mean, I I as a pure technician, you know, listen to what William O'Neal said. It's also in your your state of California that talks about, you know, he studied some my my old state of California. The old state, not the new state, right? Congratulations to you on that maybe, right? Or not. Thank you. Yeah. No, no, no. It's it's good. I I uh but but he, you know, he wrote a book called How to Make Money on Stocks and he studied, you know, hundreds of stocks like Amazon, Intel, whatever you want to call it, Microsoft over time. And he said they all had one thing in common before they went up three to 400%. They all hit brand new all-time highs. So, when I hear all-time highs as being something that anybody would consider to be a negative, um, you know, we all want to own where the momentum is, momentum has been the number one factor over the last two decades in the stock market, right? It's not buying mean reversion and hoping that these stocks that are below their intrinsic value are somehow going to rally when the volume and the institutions are just selling them. Uh, it's very, very difficult to make money trying to buy low, sell high. It's really a misnomer. One should always be buying high, selling higher, uh, avoiding things that are going low and or shorting those to cover lower. At least that's my own philosophy and and people like Andrew Low from MIT have written papers about this as being, you know, statistically accurate and something that happens. Anyway, so I'm going to interject for one second because I want you to keep keep expounding. I just want you to take this data point into consideration. So buying high, sell higher. get it as a momentum um investor, but what you got to be careful about is that you're you're you're not the greatest fool who's buying in, you know, at the last moment, right? And that's where we get to the valuation metrics. And I could put a whole bunch up here, but I just want to put this one up here that I just saw yesterday for the first time. And it's the weight of names in the S&P 500 that are trading above 10 times uh they're trailing 12-month price to sales. Right. Right. So, this is I believe this is market cap weighted. It's not the number of stocks in the index. It's of the stocks that are trading above 10 times their sale price of sales. What percent of the index does this make up? And you'll see here that we're at an all-time high. And so this would indicate the market here is pretty richly valued because the only other times it's been even near here was right before the.com bust and right before things rolled over at the start of 2022. And we are much higher than those two peaks. So how do you how do you take stuff like this into account? I I don't think it's ever worthwhile to pay attention to that. I think that we're in a new era of AI and I think it's very difficult to put a a figure on on valuation particularly when you know all the indicators that I look at for sentiment uh or indicate you know AI just came out and it's still bearish and it's been bearish for the last two months. People are not all that enthusiastic about the market. CTA exposure while it's been forced to follow uh the market move they they've adopted measures to expect a correction and we've seen that in the puts skew uh active hedging and so you know I I I get that whenever I ask people how do you use intrinsic value let's say you think a value of a stock is 30 if it goes to 35 or 40 are you going to be selling that stock um and then how about if it goes to 100 what do you do then how about if it goes down to 25, are you going to be buying it? If you think it's worth 30, is that a good time to buy? And and honestly, this all has to do with the difference in in methodology and discipline because I I am never buying extreme weakness and sitting for weeks and months for things to try to rebound. case in point, stocks like PayPal or, you know, Salesforce.com or or any of some of these software companies that have lost their edge and they haven't caught up with the AI story and the stocks have been punished. I mean, many of these just aren't you would argue that ah they're down off their their highs and it's time to buy. You know, honestly, you know, you want to be owning things like uh data storage right now and what's happening with the Seagates of the world and Western Dig and and they obviously have uh been outperforming. it doesn't mean they're a sell just because the stock price gets overbought or you know the problem I have with fundamental analysis is that all these analysts cluster together with their their targets and if you have a couple of big people on the street all the other guys say well they're all at $2 a share so how in the world can I value this at you know $3 a share I have to sort of figure out what I'm doing wrong and come in and so when these companies tend to exceed the estimates dramatically everybody's left scratching their head so fundamental analysts always go to bed upset because they uh think that something is either extremely undervalued or extremely overvalued and they can't be at peace with that. Technicians like myself on the other hand go to bed knowing what the trend's doing and you stick with the trend until and that might sound simplistic or naive or but but honestly in the long run uh you know you showed me the picture of a giant breakout of 2,000 highs. Does that make me think it's going to mean revert right away if it's just gotten to the highest level of all time? Um, you know, the PE arguably the market is right around 26. It's not where it was back in ahead of the do when you look at the Exodus Communications and all these other stocks that are trading at, you know, Cisco was trading at 100 or trading at 150 or 200. So, arguably the PE of the market is not if you strip out the AI, which is probably the most important area, but it's nowhere near where we were in 2000. and and so, you know, the biggest problem that I have is probably the degree of debt that the economy has and the reluctance to cut spending. And I think eventually that will catch up to us, but that's also a problem that's not going to affect the market on a on a day-to-day basis. And that's an unknowable in terms of whenever that's going to matter. It I think we all agree it'll matter at some point. Yeah. But So, let me ask you a question. So, so if the market's at 6600 and let's say we all go to cash and so let's say next year we go to 7,000 or 8,000. And I mean, what service have we done to our clients to be negative while the market just goes up and up and up and and it's like we have to use trend following and technical analysis and our discipline as a part of that? Or else we're we're doing a disservice regardless of what our beliefs are because things continue to move in ways that most who have learned Wall Street fundamentally are never going to be there and buying highs. They're always going to be wanting to buy dips because they see things as good value. We always want to be buying low and selling high, but that's precisely the opposite of the way you want to invest money. So, I I I I totally get this and again, let me let me uh again commend you for um your approach working so well this year. um you know as many experts on this channel say which sort of echo what you're saying which is you know I I don't know I don't know if you would say this but I think you might which is that um valuations matter in the long run but they are terrible timing tools. So to your point you know Yeah. Um and all I wanted to know was how much do you take into account at all when we are heavily deviated on valuation metrics and and what I kind of heard was I don't really right that your your your methodology is is both momentum in terms of what the the the tape is telling you but I also get the sense it's pretty heavily influenced by behavioral economics like and that's where I I see sentiment playing a role. Right. And kind of what I've what I've deduced from what you're saying is is look, I've seen enough of these cycles where I know how crazy the party can get sentiment wise before it ends and we're just not there yet. Um is that is that is that that's fair. That's completely fair. Yeah. So so if we start to see real breath erosion, we start to see technology really start to roll over sharply. Uh the market's very thin, nothing's working, uh sentiment is really really bullish. Then when we start to break down, then you have to respect that. But as somebody that tries to make clients money really over the next few weeks to few months, and I want clients to always be in things that are going to be helping to add alpha where they're making money for their clients and making money for themselves. Um, you know, I just don't have a lot of confidence that using, you know, valuation data as being something to try to keep people on the sidelines when it just hasn't proven to be effective as a timing tool. Got it. So, some people some some folks will look at data like that and say, you know, I'm still going to be in the market, but I'm going to stand I'm going to dance a little closer to the door. Like, I'm going to be on the dance floor, but I'm going to stay a little closer to the door. I don't get the sense you you're saying that. You're saying I'm not going to move closer to the door until I start to see some breakdown in some of these key metrics you look at. Yeah, I guess on a shortterm basis, on a short-term basis, I'm probably a little closer aligned to that theory between now and November, say the next two months. I I do agree with that because I because your indicators are telling you that November, October, November may be That's right. So, I I do sense that that can happen. Uh I guess two months is probably shortterm based on how you and maybe other people would look at it. But it it's something where if I look out over the next four or five months, um there's just not enough warning signs yet in my work. And I think those will be it's not like we'll we'll miss those. I mean, those those are very clear to see ahead of time. And sentiment, you know, regardless of what you look at, um you know, there's tons of polls. Most of them are are neutral at best. Even the CFTC data on S&P futures shows people net short now as a percentage of open interest on across different indices. Um it it makes me real reluctant to get to think that markets are going down right away because all those things have proven wrong. Why should they suddenly be right, right? So valuation is proven wrong again and again and again and everybody looks at valuation differently. So I I guess um you know Robert Schiller probably is one of the more interesting people to read about his books on socioeconomics and and how he values things. Uh and and so you know I I I don't tend to use the traditional metrics on saying everything is really extended and we're going to go into a bare market. I I think it's a little premature and if you study the longerterm cycles, it doesn't suggest that 2025 was ever going to be a down year. It's the best year of any given decade in terms of dennial cycle pure theory. And given the negativity, you know, as we head into the next couple years, it is a little different story uh heading into, you know, the pre-election year and the election year and and uh you know, we'll see what those have. But the midterm year typically uh is really one of the worst of the four-year cycles and that's coming up next year. So I would have you're saying that as a as an analyst uh or a student of market technical history, right? That in correct the average of of these years over a 10-year period tend to for tend to perform in a certain way on average. Right. Almost always if you look back over the last hundred years, the midterm year has been one of the worst of the four-year cycle. And uh this year uh you know being the fifth year of a decade uh you know has been the best. And so it's it's not surprising to me. I I clearly even in my interview I don't think I call for markets to go to to and hit my year-end target by September. I think it's been a remarkable move that's surprised even myself to the upside. So now you have By the way, are you moving that up to 7,000 because you mentioned 7,000 earlier as a potential Yeah. I mean, I I I I don't see a lot of value in in doing things like that. Honestly, what I'll do is after I think we get a correction from October to November, then I'll probably look at it and try to make a a best case example. I mean, I I put out a number once a year. I I try to stay with the here and now and and sort of manage risk tactically and how I look at markets. So, I don't think it's always wise to think the year end really matters. Um, so I I'm still where I am. I just think we'll probably, you know, maybe we go to 6,700, we pull back a little bit, we run up to 7,000, and then maybe the market has an earlier peak. But, but, you know, I I don't like to speculate like that. I want to let my indicators and the trends really uh really help me in that regard. Okay. So, I want to ask you about a couple of asset classes that I've I've seen you and your firm talk about recently. Um, real quick though, so the uh I would say the viewers of this channel, Mark, are um, you know, they watch these videos to become better informed and hopefully make better decisions in their investing. And obviously they want to grow their wealth. Um, but they want to do so prudently. And I would say because twothirds of the viewers of this channel are over 45 years old, um, they're they're either nearing closer retirement or in retirement. And so more so than prudent growth, they just want to make sure that they don't get steamrolled by a market correction, right? So, um, if I heard you correctly, you said that that you your model actually told you, um, to anticipate some sort of correction coming into 2022. Um, yes. Just Yeah. Actually, if you look at a CNBC interview, it's called uh, it's actually Tom Lee. I've had been with the firm two months and it's called a turning point and I joined in September of 2021. Actually, we're three days away from my four-year anniversary. So, I told Happy be a correction and uh and he went on CNBC and said, you know, I think my my new guy Mark Newton here thinks the market can sell off. And everybody's like, oh, Tom Lee bearish. What do you mean? Yeah. And that was the peak of the the NASDAQ, the Dow Jones Transports, the Russell, most of Europe, uh everything but the S&P peaked on SE on November the 17th of 2021. And of course, the S&P peaked in the first couple days of January. But uh I called for a 20% draw down to uh I believe 3500 by June. And um you know, that that proved right. But but it's not a matter of taking a victory lap. It's more about just uh you know I I'm not you know I don't consider myself a perma buller or a perma bear. I I'm more I I focus on trends and and the trends for the last couple years have been uh you know thankfully very good and I've been bullish and optimistic since 2022 and uh you know we'll see where that takes us and and uh maybe I'll have to make some adjustments heading into next year and and we can talk about that in December. Okay. Well yeah you're kind of a version of Joe Friday. Maybe we'll call you Joe Saturday where instead of just just the facts, ma'am, it's just the trends, ma'am. Right. That's right. Well, yeah. To some extent. Yeah. Exactly. All right. But I think you've just answered, but I wanted you to speak to how successful is your methodology at not just anticipating, you know, continued runups in the market, but also anticipating potential corrections. Sounds like it's got a pretty good recent track record. I think people have been very happy with this. I think that we at Fundstrat present a uh a very complete view where Tom Lee does a lot of the longer term uh top down sort of macro uh looks at inflation. I of course am much more tactical and shorter term and so I can you know I have the ability to be able to talk about things going you know up or down in several different asset classes and I think that complements each other. People like to make decisions on their own. you're given a lot of really good data and so you know it's not always for us to to hold people's hand but it's more like this is what we're seeing this is where we're right and where we're wrong and it's up to you to make that decision on where how you want to invest your own money but these are our you know this is what we like and so we try to each month come up with a list of sectors that we like and you know I specifically write about interest rates and the dollar and and precious metals and oil and what I think about crypto and stocks and So, you know, it's been it's been a very good uh four years for me. I'm very happy I joined these guys. I've been on my own for a number of years. I traded equity options at the CBOE in Chicago for a while and I was with a hedge fund and I ran Morgan Stanley's technical department in New York back in uh 2006. And so I, you know, this is a wonderful firm. It's a great platform and and love to talk to people about what I'm seeing and and uh you know, it's really resonated. So, great. Well, congratulations. And I chuckled there because you pretty much just listed off the assets I wanted to ask you about specifically. And um we don't have a ton of time left, but but so give your answers however much time you want. I mean, we're not I'm probably happy. In general, I think that that the dollar and rates uh have one final flush that's going to happen uh really between now and October. And thereafter, I sense that they're both going to start to turn higher. that lasts probably into uh the early part of next year. So that indicates that you know yields coming down historically has been very very bullish for for stocks. Um there's been some good correlation there. I I I sense that if yields now start to turn higher uh probably by next month and also with regards to the dollar that that could be at least a technical catalyst, you know, looking at correlation for why the stock market, you know, might start to weaken a little bit. Might start to weaken. Yeah, that makes sense. So, I I I in general am bearish on both the dollar and yields uh probably over the next 6 to9 months, but I think we're we're heading towards a time when both are going to start to bounce. And I think that probably starts in about a month. Uh I I think with regards to precious metals, uh I've advocated being long, both gold and silver, more so silver, which has played catch-up with gold and and has started to show more outperformance. Uh my own cycles say that those are due to peak out in the month of October. And so I sense that also happens because uh rates in the dollar start to go the opposite direction and go higher. And so I I I do think gold has gotten very very overbought using my metrics. I had a 3,800 target. We're almost there. Silver, you know, I still think both of them push higher over the next three or four weeks, but I'd be probably a little bit closer towards taking profits and just watching carefully for evidence of trend damage in the metals, which I don't think are going to be able to carry up indefinitely through the end of the year. I do sense that we're going to have a pullback in the metals as well. I mean, they were up 40 plus% this year. curious on that. Um yeah, so put you know uh peak out maybe next month maybe a you know rocky end of the year or volatile end of the year from a trend perspective going into 2026. Do you expect them to run up or do you expect them to get under pressure because you expect um rates in the dollar to continue to strengthen into 2026? Yeah, I think that the strengthening probably lasts for the first few months and that could coincide with weakness. So even though gold historically has had a good December, you know, I think that the metals uh probably are within a month of uh peaking out and start to turn down. Uh I would look to buy weakness into probably the middle part of 2026 because I do sense that uh you know for a number of reasons. Central bank buying, the deterioration of the dollar will be a concern. People want to own hard assets uh lack of independence for the Fed. um you know some concerns about fiscal sanity I guess in the US and continued spending. There are a lot of reasons why you want to own precious metals but it's been such a great year and gold's been going up for you know two and a half years and so it's just a matter of watching the cycles and most of them are going to start to turn down uh later this fall. Okay. And you know this just so you know this comes along my advice to people of late that they've had a great run. nothing goes up in a straight line, you know, time to at least consider rebalancing, taking some profits, you know, or putting on some hedges. Sounds like your your your model is saying probably wise to at least consider that at this point. Uh the cycles say that the trends do not. And so I always lean on trends first and foremost. So, I'm still expecting a big move over the next month, but then I'll probably, you know, people like myself that watch the markets daily like to uh, you know, hope that they can try to top ticket when a few things come together. So, I think there's a better um opportunity or riskreward for selling that probably comes about uh, you know, in a few weeks, maybe four or five weeks, but I think uh, you know, there's a possibility that that both uh, metals and also the S&P might go down at the same time because rates are starting to rise again. So that's something to keep in in mind. Keep in mind absolutely. Okay. How about oil? Uh you know it's funny because the cycles start to turn higher in crude but a lot of the fundamental data and the supply and even the technical trends are still very negative. I sense that we have one more move to the downside and I sense that happens really between now and October. Also, I think that crude likely gets down to probably 58 $59 from 63 and thereafter I think we probably are going to bottom in crude and start to to push higher. It's been a a big bare market in crude over the last few years and um you know I I don't sense that we're going to continue to punish these other countries for the supply. I know there's obviously a lot of different reasons why we want to do that. I I believe the administration likely cut deals with Saudi and and I I think there reasons why they'll keep supply a little bit on the high side in the next few months, but I don't think that's going to happen forever. I think that the Middle East makes money as as crude goes higher. Uh you know, they want to the administration wants to keep inflation down of course and keeping crude down is helpful in that regard, but uh the cycles seem to say that uh the last couple months could have a rise in crude. So, I I'm keeping sort of shorts a little tight to the vest there. I still think we have one big flush to the downside and energy and I probably want to use that to buy and thinking energy makes a lot of sense heading into 2026 as something to consider being long. All right, that's I was just going to ask it sounds like you're saying it's it's smelling to you right now that end of the year might be a good buying opportunity entry point into energy, especially oil. I think that's right. Yeah. Historically, it's had a seasonally bad time from, you know, end of the year into really January, February, and then it has a big spring into like this, you know, so that's a, you know, February through May is generally a great time to own energy and and crude, and I think that's probably going to also prove to be the case, uh, you know, next year. Okay. Um, all right. Well, look, um, crypto, um, love to get your thoughts on that. And, you know, I think you guys are all over the news these days about Ethereum. Um, but feel free to talk about whatever cryptos uh have your attention most right now. Yeah, it's interesting because with regards to crypto, you are starting to see evidence of uh of altcoins really picking up steam and that says to me a couple things. It means that the entire rally from late 2022 in crypto is probably nearing the uh the last few innings. Um, you know, I haven't seen the sentiment yet, but but obviously as you said to your point, I mean, it's all over the news and even our own efforts. Uh me being a technician, I I try to ignore a lot of the news, but but I I my own target for uh Ethereum is is, you know, 5,500 and for Bitcoin, it's about 130,000. And I think in general, I'm much much more bullish on Ethereum over the next year than I am on Bitcoin. Bitcoin has begun to lose uh lose relative strength compared to many other uh cryptocurrencies. So, um, you know, to your point about the meme stocks starting to kick into gear, I think we're also going to see that with regards to altcoins, there's going to be a lot of lowpriced, uh, crypto that that that do quite well in the fourth quarter of this year that, uh, probably will be an interesting u, you know, something to watch with regards to sentiment, but it also means we're getting sort of late in in the rally. So, I negative next year is is is far more negative for for crypto. So, it is a cycle that historically has led Bitcoin down in 2022 and 2018 and 2014 and across the board. And so, I think the time to be long is right now and really look to exit by uh by end of year. All right. So, those targets that you shared, 5,500 for Ethereum, 130,000 per Bitcoin. Those are sort of end of year 2025 targets. I think that's probably going to happen in Ethereum sooner than later. I think it's probably October. Uh and I think Bitcoin has also started to push higher lately. So, I think we probably get there and then we're going to have the same kind of uh pullback in crypto as we do in equities because the two still have a pretty remarkable degree of of correlation. Both bottomed on April 7th. You find tops and bottoms in both that have it's more along the lines of what the eco-rated S&P more than the NASDAQ because we've largely gone sideways over the last couple months in Bitcoin that's not dissimilar from the equated S&P. But, uh yeah, I sense that we're going to have a pullback that probably also happens in late October, November for crypto. And then you really want to buy dips probably even in bigger size to think that we're going to have our our sort of final p you know push up into uh year end. All right. Um well Mark look um we powered through all the questions I had for you. Um so last one for you before we wrap up. Um is there anything else that's burning brightly on your radar trendwise, cycle-wise, assetwise that I haven't thought to ask you about that's important to talk about? Um yeah, I think we covered a lot of the major spots. Um you know, I currencies, commodities, uh equities, um you know, I I think the trend in social mood is is unusual and very very negative. And I think that is something to keep a close eye on. I don't know that there's any immediate fix to that, but things are getting worse. And you know that's something that ironically from a contrarian perspective is still probably pretty supportive of risk assets. And so that uh you know it's an interesting time for the country. But uh you know with everything a lot of this is cyclical and and we're in a very cyclical period to when this also happened back in Vietnam and a lot of the the protests and the uprising and the upheaval and it's really been a global issue. It's not really been an American issue. what's happening and you could argue it's inequality that's causing this, but there's many uh it's disturbing and and something that uh you know I think we all want to uh hope will moderate you know in the months to come. Okay. Are you I'm just curious. Are you familiar at all with Neil How's work, The Fourth Turning. You heard about that concept? I have I have the book. I I haven't uh I need to probably revisit that. Yeah. All right. Um well, if and when you read it um or if you don't have the time, you can watch I've done a number of interviews with Neil that you can watch. Yeah, it's one of those Kindle books. It's in my stack of things that I've bought that I just haven't gotten. Yeah. I'm sure a guy like you consumes a ton of content, but but if and when you you you familiarize yourself with it, would love to hear your thoughts um as it relates to exactly what you just mentioned. Yeah. All right. Well, so most important question and concluding here for folks that have really enjoyed this conversation, Mark, maybe it's their first exposure to you. Where can they go to get uh to follow you and your work in between now and your next appearance on this channel? So there's a few areas. One is just to go to uh fsinsight.com uh which is franksaminsight.com. That's the retail if those are if you're a retail investor, you can go there and you go under our services. I do write a daily uh technical note. I have a video that's about anywhere from 7 to 10 minutes long. It talks about the market literally every single day and covers all different kinds of everything that's moving and not moving and why. So that could be interesting. Uh, also I'm on X on Mark Newton CMT. CMT of course is charted market technician which is the sort of the badge of honor for those that do technical analysis. And so um, you know, feel free to go there. I don't often post a lot of uh, you know, actionable thoughts to to people because I have 100,000 subscri you know whatever followers and obviously we give most of my content to paying subscribers. But I do, you know, retweet a lot of things. is there's a lot of video content on there and uh I do a lot with Fox and CNBC and Bloomberg and and different media organizations and so sometimes they'll uh and Yahoo Finance. So sometimes I post content from my interviews there as well. So I would say you know for those that are brand new or maybe you're an institution uh RA you can go to funstrat.com. So we just celebrated our 11th anniversary started in 2014 and uh you know very happy about the growth we've had not only with our ETF GRNY Granny modeled after uh you know the Granny shot that had a 94% uh success rate for I love that Rick Barry and so Rick Barry yeah the Rick Barry metrics as to why you know the the thinking being if it hits all these different categories and it has an above average chance of of working and so uh run by title but fund strat does and our own Tom Lee and Ken Schwang uh run the portfolio. And so it's it's up about over 30% for the um close to it's it's outperformed the S&P substantially. Uh and it's up to 2.7 billion in assets in about nine months. Wow. That's organic growth. That's without being on a lot of platforms. So that's still growing very very quickly and something you might want to take a look at. Grny Granny. All right, Mark. Thanks. Um when I edit this, I will put up links to all the assets you mentioned. Insight.com, your X handle, Funstrat, and the ticker symbol there for GRNY. Um, fantastic. Um, Mark, hold on for one second here. I'm going to I'm going to do a little bit of house cleaning for housekeeping for about a minute and then I'm going to let you give whatever parting bit of of counsel you'd like to give to the viewers who as I said are are you know we do have a number of professional investors here but most of them are retail investors just trying to you know make a make a prudent buck but also more importantly not get wiped out here. Um, real quick folks, um, please join me in thanking Mark for coming back on and being so transparent and granular in what he's seeing. Uh, so to do that, please hit the like button and then click the subscribe button below as well as that little bell icon right next to it. Um, if you uh would like if you're not an institution um, but you're a retail investor, one, go check out Mark's work there at fsinsight.com. Um, but if you'd like to get some uh professional help in figuring out how to um position your portfolio for the trends that that Mark has shared with us, you know, he thinks might happen through the end of this year and then some of the big trends he sees for 2026. Um, I highly recommend most people get that help from a good professional financial adviser. Importantly, when that takes into account the macro uh trends and and the the technical trends that Marcus talked about here, if you've got a good one who's doing that, great. Stick with them. don't mess with success. Um, but if you don't or you just like a second opinion from one who meets those criteria, consider scheduling a free consultation with one of the financial advisors that thoughtful money endorses. These are the firms you see with me on this channel week after week to set one of those up. Just fill out the very short form at thoughtfulmoney.com. Only takes you a couple seconds. These consultations are totally free. There's no commitment to work with these firms. It's just a free service they offer to try to help as many people as they can. Lastly, uh don't forget that Thalul Money's fall online conference is coming up in just a month. That's Saturday, October 18th. If you can't watch live, don't worry. Everybody who registers will get replay videos of the entire event, all the live all the presentations, and all the live Q&A. Uh so to do that, if you haven't got your ticket yet, go get it now at thoughtfulmoney.com/conference. Especially because we're still offering the low early bird price discount. It's the lowest price we're going to offer. Uh that's not going to be around for too much longer. I want to make sure everybody who can get it does get it. And if you're a premium subscriber to our uh Substack, look for the code I sent you that you can get uh and use to get an additional $50 off of that low early bird price. Mark, it occurs to me I would love to have you um at our next uh conference. Uh they're online. Um so really easy for you and I to um get you involved in it with plenty of advanced notice to fit in your schedule. The next one will be in the springtime, probably some point in March. Is that something you have any interest in? Yeah, I would entertain that, Adam. I guess it depends on when it is. We are going down to uh there is another future proof event in uh in Florida and Miami the middle part of March that I'll be going to, but as long as it's outside of that, we could probably talk a little more about that. All right, I I'll work with it. I think you would be a great compliment to the faculty that we have there. Um all right. Well, look, um uh folks, if that excites you too, let us know in the comments section below. But right here at the end, Mark. Okay. So, um you know, as I as I describe these people, they're they're really, you know, many of them have worked hard in their lives to build wealth. Um obviously, they'd still like to increase that uh wealth while they can, but they want to do so with a good um uh risk management in place. So, any parting bits of advice to those folks given the market conditions the way they are? Look, I always think that diversification makes a lot of sense. I think uh if anything the pullback that we saw the first few months of this year gave many people an important and painful lesson that they were probably a little too overweight many technology stocks and really not as diversified as they should be. So never you know keep your position sizes uh small and be well diversified. Um the next piece of advice is you always want to as the saying goes let the trend be your friend until the end. And in this regard, I would say it's important to use things like a 10-month moving average. And if the S&P is above that and it's upward sloping, then you want to be long the market. Uh when it dips down, and it did do that, uh not only, you know, February of this year early on for about two months along with 2022, uh we had that during the major bare markets of 2000 to 2003 and 2007 to 2009 where the market stayed under it for almost two years. So when you start to see evidence of, you know, these longerterm moving averages be broken, you know, that's a time to raise cash and and be a little more cautious. But u times when things are trending higher, generally it's important to just ignore a lot of the noise and and what you hear from the media and concentrate on earnings and trends and and sector rotation and what's happening. All right. Very very good, counsel. And and I'm curious here. So from your methodology, it seems to me um sounds like you're you're generally you you think there's a longer term expected total value if you ride the trend as long as it goes and then see that it breaks. And so let's say you you pass the peak by I'm making this up a number five 7% or whatever. you're willing to lose that five or seven percent because it's proving to you that the run is over versus trying to anticipate the peak and getting out too early because you might miss that it goes up by another 30%. Yeah, that's very well said, Adam. I couldn't agree with you more. That's 100% correct. I mean, even on a small pullback, you know, you don't really have sufficient evidence most times that it's we're starting a bare market. So things can carry up a lot further than many expect on both, I guess, the upside and also the downside. So you really just want to let trends be your guide. If you combine trend following with the fundamentals or with the macro or however you look like to look at assets, I think you do yourself a world of of good and service. And for those that come aboard with us, we're happy to educate you on on how that process works and what we look at. All right. Well, again, congratulations on a a great year and um again, really look forward to having you come back on December to share your 2026 outlook with us. Thanks so much, Mark. It's been great. Thank you. Yeah. Byebye. All right. and everybody else. Thanks so much for watching.
