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

Finance-focused summary (key numbers, instruments, and recommendations)

Market regime & timing outlook (equities)

The guest frames the recent move as a historically violent V-shaped rebound after an early-spring selloff:

• +3% each of the last three weeks
• +12% over the last 14 trading days
• A notably fast move described as “from a 100-day low to a 200-day high” (exceptional speed)

Why it rallied (macro/geopolitics through a technical lens)

• Improving market breadth: the percentage of stocks above 20-day and 50-day moving averages rose meaningfully starting mid-March
• Fewer stocks making new lows, approaching a bottoming pattern
• No true oversold / no capitulation, i.e., not seeing excessive downside volume
• Cross-asset improvements:
  • weakness easing in oil
  • dollar/rates pressures backing off
• Earnings support: earnings revisions and actual earnings strength cited as constructive

Forecast / expectation

The stance remains net bullish, but not “straight up”:

• Expect a 3% to 5% pullback after the surge, likely into mid-May
• Then expects a stronger summer with a push toward major highs

A seasonal/cycle framework is also referenced:

• A larger push could occur into late July / mid-August
• Possible pressure August–October / November (near midterms)
  • Potential inflection if a selloff occurs during that window

End-of-year price target / index level

• S&P 500 target: ~7,300 (reiterated as the year’s endpoint)
• View: the market ends higher, even if choppy

---

“Trust the market / risk management” framework (explicit steps/rules)

Core technical rule

• “It’s always important to understand the market’s right” and adjust risk parameters when price action changes.

Long-term trend follower rule

Use S&P 500 vs. its 10-month moving average:

• If S&P is above the 10-month MA → stay long
• If S&P falls below and the 10-month MA turns down → become cautious / exit (depending on interpretation)

Historical examples cited to support regime behavior:

• 2000–2003
• 2007–2009
• 2021–2022

What would justify being bearish (conditions)

• Breadth deterioration: fewer stocks hitting new highs, leadership/momentum rolls over
• Rates trigger: long rates rising materially would undermine the bullish setup

Key level referenced for 10-year Treasury:

• 10-year > 4.60% could imply ability to push toward ~5%

---

Rates, Fed governance, and bond-market implications

Core concern

• Long-term yields rising → bond prices down

Policy/leadership theme: Fed independence

• Discussion centers on Fed leadership continuity and independence.
• The expected Fed chair nominee is referenced as “Worsh” (transcript naming is inconsistent, but the theme is independence).
• Guest view: the nominee is likely independent and supportive of:
  • Inflation-fighting
  • Continuing balance sheet reduction (QT), likely via rolloffs
  • Potentially more willingness to work with rates rather than relying as heavily on balance-sheet tightening

QT / liquidity caution

• QT should be judicious to avoid constricting liquidity too fast.

Rates scenario & timeline

• Risk of bond yield rise framed as most relevant into Oct–Nov
• Conditional logic:
  • If the 10-year goes above 4.60%, risk rises for about ~5%
  • That move could spook equities, but may not happen instantly

---

Sector positioning (equities)

Bullish / overweight (next ~3 months)

• Technology: expected massive outperformance
  • rationale: it lagged for 6–8 months and valuation is cited as becoming “reasonable/cheap”
  • Mag 7 referenced (large-cap tech)
• Broader tech:
  • Semiconductors / memory
  • Example tickers discussed:
    • Micron Technology (MU)
    • SanDisk (storage; context suggests WD, though ticker isn’t stated)
• Industrials (explicitly liked)
• Financials (explicitly liked)

Cautious / less attractive

• Software: caution after large drawdowns; it can take time (“two steps forward, one step back”)
• Defensives (near-term relative weakness):
  • Utilities, Telecom, and consumer staples characterized as lagging
  • Utilities noted as turning weaker
• Healthcare:
  • Biotech described as “phenomenal”
  • But medtech / healthcare services / pharma expected to lag biotech in the current rotation

---

Commodities & energy

Oil

• Starting context: oil around $115 earlier in the conversation
• Day-of reference: Brent futures ~90
• Guest view:
  • Energy remains in a “violent short-term decline”
  • Expects crude could fall further:
    • under $60 mentioned as a possible level
  • Belief that the oil bear-market low is established, but consolidation continues
  • A sharper move may follow once agreements resolve the Strait/war conditions

Natural gas

• Preferred: European natural gas (TTF)
• Less enthusiasm for Henry Hub (US natural gas), except as a reference point

Energy sub-theme

• Nuclear is described as comparatively more supported
• “Alternative energy parts” are said not to be working well (no specific tickers beyond general mentions)

---

Precious metals (gold/silver) and timing

Metals are framed similarly to stocks:

• Expect a dip in May to buy into
• Expect a final push to new highs between May and October

Specific levels mentioned:

• Gold: “stop around $5,000” and then consolidate
• Pullback expectation: give back roughly half of the move since late March (after the initial target)

Longer-term caution:

• Metals may peak “this fall”
• Potential follow-through: a multi-year bear market
• Rationale: real rates rising and late-cycle conditions

---

Agriculture / “softs”

• Guest says agriculture commodities are strongly liked
• Expect a year similar to 2020, with a “big rise”
• War-driven disruption is framed as a catalyst, though cycles also pointed to gains

Mentioned equities / names:

• CF Industries
• Bunge (spelled in text as “BUNGIE”; ticker not stated)
• Mentions focus on fertilizer stocks:
  • CF Industries
  • Bunge
  • Also references AGs and fertilizer stocks generally
• “Bungie” also added to an “Uptix list” (technical favorites list)

---

Crypto (Bitcoin)

• Earlier year target: fall to $60,000; lowered
• New expectation:
  • Bitcoin to ~ $52,000
  • Expect a pullback into May with deeper weakness

Regime framing:

• References a 4-year bear market cycle
• Possible opportunity later:
  • buyable lows mid-to-late May
  • stronger period might come June to fall
  • potential higher-low around Oct–Nov

Explicit caution:

• This spring expected to be choppy and corrective
• New highs this year not the base case
• View: “real buying/infrastructure is not in place,” implying technical weakness until flush

---

Private credit

• View: not a near-term systemic threat to rates/bonds
• Rationale:
  • Relationships between investment grade vs junk discussed; response described as tepid
  • Spread metric referenced: OAS roughly ~450 bps above Treasuries (not treated as crisis-level)
• Conclusion: likely not “up at night” for the next quarter or two

---

ETFs / instruments mentioned

Funstrat / “Granny Shot ETFs” (explicit tickers)

• GRNY
• GRN II
• GRNJ

(No other ETF tickers were clearly stated.)

Other indices / instruments referenced

• S&P 500
• Russell 3000 (breadth gauge)
• euro STOXX 50 and STOXX 600
• Nikkei
• Brent crude futures
• WTI not explicitly stated (oil discussed via Brent)
• Bitcoin

---

Explicit recommendations / tactical stance

• After a very fast surge (+12% in ~2 weeks), it’s “proper” to hold some cash to buy dips (exact amount is personal)
• Expected buy-dip windows:
  • May for stocks (small pullback)
  • May for metals (dip)
  • May for crypto (deeper dip)

Overall posture:

• Bullish but cautious
• Trust the trend, but expect chop, not recession

---

Disclosures / disclaimers

• Host emphasizes: “not financial advice”
• Suggests consulting endorsed financial advisers (Thoughtful Money)
• Guest repeatedly frames the views as discipline/risk management, not guarantees

---

Key numbers & levels mentioned (quick list)

• Equity moves: +3% x 3 weeks, +12% over 14 trading days
• Pullback expectation: -3% to -5% by ~mid-May
• Index target: S&P 500 ~7,300 (year-end)
• Rates threshold: 10-year Treasury 4.60% → potential ~5%
• Oil:
  • crude referenced around $115 earlier
  • Brent ~90 day-of
  • potential further decline: crude < $60
• Metals:
  • Gold “stop around $5,000”
  • buy-dip window: May
  • potential push: May–October
  • peak risk framed as potentially this fall with longer bearish follow-through
• Crypto:
  • Bitcoin to ~ $52,000
  • buy/dip timing: mid-to-late May (if conditions hit)

---

Presenters / sources (end)

• Adam Tagert — host, “Thoughtful Money” founder/host
• Mark Newton, CMT — Head of Technical Strategy, Fundstrat (working with founder Tom Lee)
• Source references:
  • Tom Lee
  • Steve Cohen and Druckenmiller (quoted re: risk management philosophy)
  • Thoughtful Money (disclosure context)