Milton Berg: “Overwhelming” Evidence of Bullish Action In Stock Market
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The ECB is ready to do whatever it takes to preserve the euro. And believe me, it will be enough. Thank you. Let's close this f***ing door.

- Today, we've got a very special interview. I'm speaking to Milton Berg of MB Advisors. Milton is not like any other technical analyst. He doesn't do charts. He does data. He's worked with some of the best investors in the world. I won't name them, but everyone listening knows who they are. Milton, welcome to Monetary Matters. - Jack, good to meet with you again. - It's great to have you, Milton.

How are you thinking about this market as we sit here today? It's fascinating. Just over the weekend, I got the latest issue of Barron's and the headline is, where did the bulls go? The percentage of bears in our latest big money poll is the largest in almost 30 years. Wow. I love to see that. Not because I'm a contrarian, but my work is extraordinarily bullish at this time.

The fact that there's so few bulls out there and so many bears just tells me that most people aren't doing the kind of work that I do, which just gives me an edge. And that just makes me excited. No, there aren't too many bulls around. We are very bullish. We think they may be historic. There's a stark turning point took place last month. That does not mean the market's going to be up 1000% over the next 10 years. It just means that there's more, should be much more to the upside. And that's all we really care about. We're actually positioned 150% long.

while people are still skeptical and thinking Great Depression caused by tariffs. So we have a very strong view here. I'd like to present the evidence to you and to your viewers, and also like to discuss the process. We have quite a different process than most technicians. I don't call myself a technician. I call myself a market analyst.

And as we go through the process here, you'll see exactly what I mean. We have covered the Great Depression case amply on this program. So I'm glad to hear for the sake of balance that you are here. Milton, why are you bullish? Why do you think that last month was a turning point in the market? Before we talk about why I'm bullish, let's look at what has happened. Did we really have a bear market?

Let's look at the Russell 2000. The Russell 2000 generated a double top from November 5th, 2021 to its peak in December of 2024. It really went nowhere. Not as if we had a raging bull market for the last few years. Based on the Russell 2000, we had a flat market. And at the April 8th close, the Russell was down 27.92%. So you're talking about over nearly four years, nearly a 30% decline in the market. Just for inflation, it's more like a 40% decline in the market, in that market.

So we've gone through a major bear market in some indices. That's looking at the Russell 2000. Again, a prerequisite for a good bull market is to be preceded by a good bear market. So while it seems that we only had a correction lasting a few months, taking the S&P down 18%, it was actually much more significant than that. Looking at the Nasdaq,

Now, the composite at the April 8th low actually declined over the previous four years. From November 19th, 2021 to April 18th, the NASDAQ was down 4.92%. So it's not as if we had a roaring bull market for four years and then we had some sort of a correction.

We actually had a market going nowhere for four years while the United States was doing quite well. Companies were doing quite well. The market is setting up for the potential for a big up move, despite the people assuming that we really haven't had much of a bear market. And the same thing, the S&P 500. S&P 500 at the April 8th low.

was only up 3.88% from its high in January, 2022. Again, just for inflation is down something like 15% over that period. So we had a four-year period where the market has gone nowhere. Now, all of a sudden, we have people talking about a Great Depression ahead and a way overvalued market. And the work we're looking at is telling us

as the market should be headed significantly higher. Thank you. Milton, in your research, you write that you're seeing historic bullish action. So we get the case you said that there hasn't been this giant bull market in the Russell and the Nasdaq composites. What about over the past month? What have we seen to get as bullish is really the question.

Now, if you want to talk about the fundamentals, it is quite possible that what President Trump is doing is going to be very positive for the economy. I don't understand why everyone out there is assuming what he's doing is going to be very poor for the economy, is going to cause weakness in the economy. Even if it causes some short-term weakness...

The fact remains, we all know that China has been ripping us off for years. If we could somehow prevent China from ripping us off and allow our domestic production to increase relative to where it's been over the last few years, that would be a tremendous bullish factor for the market. And I don't know why everyone is somehow discounting that. They're afraid of tariffs. We're not really creating tariffs. We're just reciprocating to the tariffs themselves.

that have been created all over the world. I've been in some countries where friends of mine tried to export into that country. I had a fellow who was making a barbecue sauce. He tried to export it into a foreign country and they said, "Oh, you can't export it to this country. The size of your bottle isn't the right, not the right size. You have to adjust it to our economy." And the various things like that. So besides tariffs that are preventing us from doing trade internationally,

There are invisible factors that are preventing us from doing trade. I know Scott Best has mentioned that. He said when he started analyzing exactly what's going on with China and with Europe and other countries where we don't do much export, he found that there are invisible barriers besides the tariff barriers. So if somehow Donald Trump and Scott Best together can somehow eliminate these barriers to trade, I think that can cause a tremendous boom for the economy.

And I'm only giving you the background, the fundamental background, because a technical background is so bullish now, you really like to have some sort of a fundamental background to lean on as well. And I think this might be a strong fundamental background as well. But let's get to the technical stuff that we work out because my market projections and my market advice and my market outlook is not based on fundamentals. It's strictly based on technical work and market action.

So I guess we should get to that at this point. So you don't mind the tariffs? You think the tariffs could be good? That's your fundamental view? I think the tariffs could be good. I think Trump's a great negotiator, but I think tariffs could definitely be good because tariffs will allow us to build some sort of a domestic manufacturing production. I was a fan of Milton Friedman over the years, and he talked about free trade rather than fair trade.

We're not preventing free trade. It's the foreign governments that are preventing the free trade. I think Trump wants free trade, but in order to get to free trade, he first has to force fair trade on the foreign countries. I am not negative on tariffs at all. I think people aren't really aware of the fact that countries throughout the world are

put tariffs on and I think it's mainly a negotiating tactic. And I just think we have this great economy and what they're trying to do in our government is to improve the economy. No one is out there trying to create havoc with our economy. And Milton, thank you for sharing that fundamental view. I want the audience to know that even if you had a completely opposite fundamental view or there was a

a somewhat socialist in office who was doing things that maybe you didn't agree with politically, your process is purely based on the technicals. And if there was policy that you didn't like or didn't think was good, but the technicals were still exhibiting what you perceived to be bullish action, you would have the exact same technical view? That is correct. My technical view overrides my fundamental view. If my technical view is bullish, I'll say, I guess I don't understand the fundamentals, which are bearish.

and probably ultimately the fundamentals that I think are bearish will prove to be bullish. But currently, I'm bullish on the fundamentals and certainly bullish on the technicals. Let's see what's going on in this market. As I pointed out, we've had a 24% decline in the NASDAQ. Again, that is on a short-term basis going back to December of last year in the NASDAQ. And we had a 18% decline in the S&P 500, and we had the 29% decline in the Russell going back four years and so on. But what happened

On April 9th, we turned bullish. We have a model for retail investors, which we don't market yet. And that model turned bullish on April 9th. And you get invested in April 10th. Now, what happened on April 9th? Let's take a couple of things and review the action of the market. This is April 9th, one day past the low. Remember, the S&P was down 18%, NASDAQ down 24%.

New York Stock Exchange was up on the day, up big on the day. As we know, S&P was up 9%, NASDAQ was up 12%, but that's not really relevant for this particular technical indicator. All you need to know is the New York Stock Exchange was up on higher volume. The S&P 500 generated more than six to one upside issues to downside issues. In other words, six times as many stocks were up on the S&P 500 as down on the day. S&P gained 1% of the day.

And the five-day volume in the market, New York Stock Exchange, five-day volume was the greatest in 375 days. Simple indicators, nothing...

that you have to explain nothing you have to have a a big degree in in economics to understand market's up on higher volume sap has six times as many stocks up as down sp gained at least one percent in the day and the five-day volume in the market was greatest in 375 days now that's probably the most important key to this indicator because the reason you have five-day volume greatest in 365 days is not because you had a big update on april 9th

because you had big down days in the four days leading up to April 9th. In other words, you had volume into the downside as well as volume into the upside. Looking at this chart, as you can see, this took place five times in the past. Took place at the bottom in 1978, took place at the bottom in 1982, took place at the bottom in 1984, took place after a short 10% correction lasting two weeks in 1997, and it took place at the first market low after the 2002 bear market. It was a great time to buy stocks.

And it just took place now on April 9th, one day after the low. Looking at the history based on the previous five instances, the median gain within the next 12 months, the median maximum gain within 12 months was 24.63%. So this is just one simple indicator. You can't argue on it because I'm just stating data and stating what's happened historically. Basically, you have a strong up day and it's suggestive of a further upside in the market.

Pretty clear, Jack. Yes. Let's see what else April 9th. Again, we do turning point analysis. April 9th is a turning point day. What do we see in April 9th? Here's something very significant as well. On April 9th,

The S&P was below its 250-day moving average. We say that. We don't look at crossings, but we filter for the market below its 250-day moving average simply to tell us whether we're in a bull market or a bear market. So basically, based on this, we're in a bear move. The market was below its average over the last year. But on April 9th, the upside volume in the S&P 500 relative to its downside volume was 90 to 1. That means you look at the 500 stocks in the S&P 500.

And you look at the volume that went into the stocks that were up on the day. And you look at the volume that went to the stocks that were down in the day. And you find there was 90 times as much volume in the stocks that are up on the day to the stocks that are down in the day. Combined that with the fact that the S&P was in a bear market, meaning it was below 250-day moving average. This has occurred five times in the past. And again, this has only occurred at major turning points in the market. August 17th, 1982, a few days after that low.

August 29, 2011, during a bottoming process where the market gained 76% over the next four years.

November 28th, 2011 market gained 78% again over the next four years. December 26th, 2018, which was one day past the low, market gained 37% over the next year. October 4th, 2022, the end of the latest bear market, if you recall, October 2022. I think we spoke at that time when we were very bullish on the market. I think it was an interview with you, Jack, at that time. And again, the market gained 21% and then three quarters of the year, 62% over the next three years. And then you see it again right here,

On a technical basis, just looking at the simple stuff, upside-down state volume when the market is below 250 moving average, it's a time to buy stocks. Why argue with facts? This is the data. And this is data we spent our career really analyzing markets and finding, I don't want to call it aberrations, but finding things that people miss, finding patterns that take place in markets that suggest either the market will continue higher or continue lower. And this is just another one we found. So this is another reason to be bullish.

And here's the chart again. One day past the low. As you can see, bottom in 1982, bottom in 2011, bottom 2018, bottom 2022, and a bottom right here.

Jack, any questions? This is pretty simple as well. Yeah. So a lot of those signals indicate what I would call capitulation on April 9th, which was one week after that April 2nd liberation day, obviously April 2nd to April 9th, a very vicious sell-off in markets, I guess up until April 8th, I should say. And then April 9th is when President Trump gave a 90-day pause on the reciprocal tariff. So

Other countries other than China had only a 10% tariff, even though he raised the tariff on China at that time. Of course, as we record, President Trump has lowered those tariffs in a somewhat of a relaxation after Secretary Besant met with the Chinese officials in Geneva, just to give that context. So that's a kind of a capitulation moment on April 9th that you spotted. So very good for you and your client. Let me just tell you something. I don't want to say I have to disagree with you. What you're saying is really correct.

The reason the market rallied on April 9th, Nazareth of 12%, wasn't because of Trump. The market could have just as well declined on April 9th. It really, the market...

was set up to rally. In other words, you use the word capitulation. The kind of action into April 9th, into April 8th, into the low was a type of action that sets up the market for rally. All the market needs is a trigger. The trigger doesn't have to necessarily be a positive trigger. It's just something which gets people to say, oh, I'm out of the market. I got to get into the markets. We don't say the market went up because what Trump said. We said the market rallied because the market was primed to rally. It just needed some sort of an excuse.

In other words, fundamentals would say the market's rallying because the crunch capitulated. Technicians said the market is rallying because it was prone to rally because of the way oversold condition that was generated into April 8th. The fact that many stocks were undervalued into April 8th and many stocks were oversold into April 8th.

and all the market needed was some sort of a trigger. It could have been anything. Happens to be the trigger had to do with tariffs. Oh, Milton, I'm not saying President Trump capitulated. I'm saying the bear is capitulated. No, the bear is also capitulated, basically. That was the argument at the time that President Trump capitulated. It's not the news of tariffs that got the market up. It's the underlying strength in the market that was waiting for some sort of a trigger for it to rally. That's the way we look at it.

Okay, that's good to know. So Milton, the bears capitulated on April 9th. A lot of those signals that you flagged- Well, guess what? The bears didn't capitulate. I know many clients of mine who shorted into April 9th, believe it or not. We turned bullish, but many people shorted into April 9th, and many people are still shorting the market on the fundamental assumption that Trump is a terrible president, and Scott Besant doesn't know what he's doing, and the economy is going to collapse. So

You can't really say that what took April 9th up was short covering and bears capitulating. What you could say is that it was a very strong up day, which tells us based on the way we look at the market, that the market should continue higher. And that the reason the market rallies as much as it did is because it was so oversold into April 8th that it's like striking a match when there's a gasoline leak someplace. In other words, the market was prone and ready for a rally rather than

I don't know whether the bears cover the shorts. I think people were shorting into the rally. There's far more bulls and bears around, far more people who buy stocks than short stocks. And so I just think the people out there who delayed buying stocks for a month or two or three just had to buy stocks. It's very difficult to understand the reason why, but you can call it capitulation, however you like to call it. Basically, it was a historic day for the market.

I think it was the greatest one-day volume ever for the NASDAQ. I think the 12% gain was the second highest one-day gain ever. And I know there are many bears out there, some people you've interviewed actually, who said, I remember in 2001, the NASDAQ was up 14% one day and immediately collapsed.

Boom, Milton, Milton, let me get it. That's exactly my question. How do you identify April 9th as a bullish turning point and end to the sell-off and the start of a new glorious bull market as distinct from in a bear market as obviously there's huge one-day rallies in April 2008 and during the 2020, March 2020 sell-off, there's always that one-day 8% rally, that 10% rally. That's exactly what we're doing. What's different about the April turning point that you see that's different from just a short spurt in a bear market?

and that is a great question and this chart will give the answer to the chart we have up here is going to give the answer to the question you see the s view is below 250 average today and it's also up below 250 average

in 2001, in January, I believe, when it gained 14% of the day. And that didn't follow through. That was a bear market rally. However, this time around, there was 90 times as much upside volume as downside volume. So we don't just look at price action. Look at underlying data. This is a very rare historic move to have 90 times as much upside volume as downside volume. When you combine these two together, you'll notice this never took place

at a bear market rally, but it always took place at the end of a bear market. For example, it took place at the bottom in 1982, and it took place at the bottom in 2011, and it took place at the bottom in 2018, and it took place at the bottom in 2022. So why should I tell myself this time is going to be different and this time is going to be a market rally when the evidence tells me this kind of action, combination of upside volume,

And I'm one day past the low. It's not even filtering for one day, but this kind of upside volume with the S&P below 250 average has always been bullish in the past. I have no reason to doubt that. If you're doubting, the doubting Thomases are doubting it because they're not familiar with these kind of data work that we do. But if you've studied markets and we studied markets, most of our market study goes back to 1957 because prior to 1957, there was no S&P 500, it was S&P 90.

so you don't have the same kind of data. The market wasn't as broad as it is today. But if you see back in history, there have been five times similar data in the market. It always took place after decline and always has followed with a bull market. We have no reason to doubt it at this time. So someone wants to doubt it, they can. But so far, I've only shown you two signals. We've had over 50 buy signals and we're not talking about crossing of moving averages. We're talking about various

Simple data that when combined occurs at turning points. Let me get to the next one, if you don't mind. Of course. So let me get one that shows really many signals. Let me show them. It happened 18 times in the past. That might be a little bit more enlightening. Okay. This is also on April 9th. One day past the low.

the S&P gained 2% on the day. We actually gained 9% of the day, but we're filtering for any time in history the S&P gained 2%. And it was 90 to an upside-downside volume. But let's say we're filtering for 45 to 1. So we're being a little bit liberal over here. We're not using the extremes we saw. The extreme was up 9% and 95 to 1 upside value. We used 45 to 1 and 2%. Guess what? Just looking at the S&P up 2% any given day in the last 50 years,

Just looking at any given day where the SPF is 45, as much upside volume or downside volume. Not filtering for bear market, not filtering for those two or three-day moving average or anything. Just these two data points together. Let's see when they occurred. Let's just go through. It occurred at the bottom in 1982.

It occurred a second time at the bottom in 1982. It occurred after a corrective action before the final blow-off in 1987. By the way, I think we're most likely to have this kind of action, by the way. I think we're most likely to see a blow-off move lasting six to eight months, six to nine months, and then a final bull market top. I'm not actually projecting a...

five-year bull market for me. I'm actually projecting more likely to start in 87, but that's for later on in this interview. You saw it in 1988 after the October 87 crash. A few months later, you saw the scan kind of action, 45 times as much upside as downside volume with the S&P up 2% of the day.

This is the only time you saw it where the market actually declined a little bit in 2003. The market had already made its final low in October. It tested the low in March. You saw the signal in January. The market declined another 11%, but still, the market gained 27% over the next year and a half. Anyway, he saw it at the 2009 bottom, again at the 2009 bottom. He saw it at 2010, which was a great time to buy stocks.

Again, in 2010, 2010, 2011 at the lows. Here's another instance. During the COVID crisis, this signaled very early market decline another 17%. The point being 90% of the times,

This simple combination led to a bull move. This is the chart. Here's where we are now. We're basically at the median. This is how it's gone over historically. And this is the median. The median of the maximum decline within 12 months after similar data is 28.61%. So why should I doubt it? You'll notice there's never been a period where the least the market gained within 12 months, the least, let's see it, is 17.27%. You see that?

And all we're looking at is two pieces of data. SAP has to have gained 2% on the day and the upside to down is in volume, the SAP has to have been a minimum of 45 to one. So why should- And that's a rare signal, Milton. That's a rare signal. And it's most of the time that's happened, there's been a bull market, it continues in a bull market. Yeah? Yeah. Yeah. And this is not 19, most of our signals do not have 19, 18 precedents. We're happy with signals that have three or four precedents because we're looking at very rare data.

and we're that fundamentally should be bullish this is just what i always want to show one instance where we people might say you only have five reasons it means nothing

The reality is the fewer the instances, the more likely that the data you're seeing is significant. But in this case, I want to show we have 18 instances. And in each of the eight instances, the minimum maximum gain within 12 months is 17%. It's another great bull market signal. We can't doubt this signal. Let's see what else we have for April 9th. And again, we got signals from April 9th all the way through yesterday's close.

So let's see what else we see. Try to find the one that has 13 signals. Okay. Because I want to see some of the, I think client, your viewers would rather see something that's more robust in their view, which generated many signals in the past. Well, this is something other than the kind of things we look up until now.

We're looking at the official TRIN. Now we track two kinds of TRIN. I don't know if your viewers know what a TRIN is, so I guess I should try to describe what TRIN is. Is that correct, Jack? Yes. I remember that you like TRIN and TRIN's important to you, but I forget what TRIN is. So please, what's TRIN? Okay. At any given day, the market has some stocks up and some stocks down, right? Let's assume the S&P 500 has 250 stocks up and 250 stocks down. So that ratio would be one to one. Equal number of stocks up, equal number of stocks down.

let's assume on the same day the sdp had a billion shares trading the stocks that are up and the billion shares traded on the stocks that were down that's also ratio one to one so the two ratios match that'll be a trend of one a trend of one means that the ratio of the securities up and down is equal to the ratio of the volume in the screws that are up or down a trend above one means that there are more there's more issues up relative to relative to the volume and a trend below one

tells you there's more volume in the up stocks relative to the number of stocks that are up. A trend of 0.4 or lower is a very rare event. It means there's far more upside volume in the market relative to the number of stocks that are up on the day.

Listen, it took me quite a while to learn this to TRIN. Okay, so your viewers won't understand immediately, but I'm sure some of them are going to quickly take out a technical analysis encyclopedia and study what TRIN is, because TRIN is a very significant indicator. So TRIN below 4, I call it a TRIN thrust. So TRIN below 4 means there was overwhelming volume in up stocks relative to the number of stocks that were up. On April 9th, actually, TRIN was 0.17. I think it was the lowest in history. Okay, we're talking about historic data.

Trin on the New York Stock Exchange was 0.17. But people follow Trin will know we've never seen that before. I don't think we've seen it. We certainly haven't seen it since 1957. So that means extreme volume in upside shares? Relative to the number of stocks that were up. In other words, it's not enough that we saw extreme volume in the upside. Up until now, the few slides I showed you, we talked about 95 to 1 upside to downside volume. This is something other than that. We're talking about that ratio relative to the number of stocks that were up.

in other words it's a double it's a double thrust not only do you see high volume the up stocks but relative to the number of stocks that were up volume was even higher should have been got it listen you're not gonna jack it took me quite a while before i understood it i'm just giving you the outline but it's a very significant indicator so we looked any time in history trend was below 0.4 below i talked about official trend because official trend includes preferred stocks includes bonds in new york stock exchange we also track a non-official trend

that looks only at common stocks. But this indicator was looking at the New York Stock Exchange official trend below 0.4. At the same day, New York Stock Exchange generated 20 to an upside-downside volume.

this is not the s p upside downside is new york stock exchange upside downside volume and on the same day sap gained at least three percent very three simple indicators a trend thrust below 0.4 new york stock chain generate 20 times as much volume in up stocks as in down stocks and the sap gained three percent of the day this has happened 12 times in the past and it goes back all the way to 1957.

1957, October 23rd, one day past a 25% bear market. You saw this indicator, it gained 49% over the next two years.

62 right after that beer market, one day after the low, marking 72% over the next four years. This actually took place nine days before the low. So you had, let me just show your viewers, you had this big up day right here. You can see that big up day? The big up day, one day past the low, and the market actually pulled back down and made a lower low, a test of the low. That's what they call a test of the low. But in any event, the test was 4.5% below the close of November 1st.

But it was only 1% below its previous low. So it was just a minor test of a low. Anyway, in this case, the market gained 15% in the next year and 22% in the next year and a half. August 17th, 2082 is the beginning of the Great Bull Market. Again, August 20th, the beginning of the Great Bull Market, right after the crash of 87. After the March 2008-2009 financial crisis, bear market again in 2009-2010.

2011, 2018. Again, nothing's a perfect indicator. It's perfect in the sense that in every instance you want to hold stocks for the intermediate term, it never turned to be a bear market rally. So in that sense, it is perfect. And very few or almost no or literally no false readings. These have no false readings. For real retail investors who want to buy stocks and hold them,

There's no false. Some of our clients are more trading oriented. Some of our institutional clients are more training oriented and they really care about five, six, seven, 8% pullbacks. So you can say this in the indicator didn't guarantee you won't pull back five, six or 7%. But if that happens, you worry about it. Anyway, here show how we're acting now relative to history. This is not through yesterday's close by this is through the day before yesterday, three essays closed up 3% yesterday. Be something around here anyway. And this is the history.

You're talking about 13 instances in the past, the median maximum gains in 12 months, 30%. The worst you saw was 8% after the 87 crash because the signal took place on October 21st after the SPA gained 12%. So that's the only reason why. If you bought on weakness a couple of days later, we've been up some 15%. In any event, again, it's a great signal. The key I'm trying to point out is there's no esoteric type of indicators.

I spent my career really analyzing markets on a day-to-day basis and trying to find simple indicators that can be used by myself and by my clients to give them an edge. And this is another quite simple indicator, basically looking at

two three things sp gains three percent on a day any day new york tax change has 20 to one upside down to the volume and trin is below 0.4 again i want to point that we had a stark trend of 1.0.17 what that means i don't know for all we know president trump's going to create a golden age for the united states i don't even know that anything can happen and i don't care to know that all i care to know is that we got to be long stocks based on what we're seeing let's see what else we got

I'm going to open my Bloomberg and get the exact data. On April 9th, besides the market being up as much as it was, volume increased tremendously on April 9th. Volume on April 9th was up 38% on the S&P 500. So we're looking at the following. Looking for any single day in history, any one day in history where the S&P had 45 as much upside volume as downside volume. And volume on that day was 30% above the prior day's volume.

which is a very rare occurrence for the scp volume to increase 30 over the previous day again we filter out for option expiration days anytime volume was up 30 over the previous day and you had a 45 to one upside down volume as you can see every single instance bull market perfect record never a floor never even a pullback never pull back below the prior low let's put it that way and here's where we are now we're actually underperforming

This is through the day before yesterday. Maybe now we're a bit underperforming the historical record. And the historical record is the minimum we saw over the next 12 months is a 22% gain, 22.9% gain. The median was 33.54%. I think we should step out April 9th and try to get to a later date. But Jack, any more questions about this, about how this works exactly? We feel that the most important days for the market are the days that occur within 10 days of a market low.

In other words, I'm actually a closet random walk guy. I believe that on a day-to-day basis, market movements are random. However, I do believe that on a turning point, market action is far from random. So that's why we look for the data that occurs close to a turning point or close to a low to see whether that low is significant. For example, the market's down 18% and it held its low for three days.

That's when we would like to look at the data and see whether the data take place three days after that low is consistent with what takes place early in a bull market or is consistent with what takes place during a continuing bear market. And that's really all we're doing here. So Milton, I'll just jump in and say,

I, from interviewing you in the past, I know that actually for what counts as a signal to you, it has to meet many different criteria. And oftentimes you'll come up with a signal and you'll say, nope, this signal is not good. I'm not going to show it. I'm not going to include it. For example, I remember doing an interview with you in the spring of 2023 and you

a lot of people were bearish, you were bullish, but you actually only had a handful of indicators, I think in the single digit indicators that were actually bullish. And you said you didn't have any bearish indicators, but you had, I believe, let's just say eight or nine bullish indicators. Now you said you have over 40 bullish indicators. Yeah. So can you just speak to the scale and the sheer number of bullish readings you have and the lack of bearish readings you have and how that informs your confidence? Good question. I've learned through experience that

that when the market generates a good low, the market will continue far higher than the public expects. In other words, look at any bear market low. Look at the low in '82. Look at the low in '87. Look at the low in 2002, 2003. When the market generates a good technical low, the market's going to rally far more than people expected at the time of the low. Not only that, we generally expect the market, when you see a good low based on the technical indicators, we generally expect the market rally to last

at least three quarters of a year, sometimes as much as one, two, three years. In the spring of 2023, as we were talking about 2023, right? Yes, yes. We just had a major low in October of 2022 and a confirming low with a breath rust in January of 2023. It was highly unlikely that this bull market would peter out by the spring of 2023 due to the fact that we saw major buy signals in January of that year and October of the prior year.

That was really at that point why I said we don't need too many bull indicators to suggest the market's going to head higher. Now, however, with the market down 18% in the S&P, it looked like a crash and the Nasdaq down 24% and Russell down 29%. Just a couple of minor indicators wouldn't have been enough to get us long, but the market did what it always does at a turning point. It gives us 50, 60, 70 reasons to be long the market. And that's where we are at this point.

but your question is very well taken and the answer is we have to keep history in mind in the spring of 2023 the history was great buy signals in january and great buys in the previous october so you have to get the benefit of doubt to a continuing bull move that makes sense okay let's look at april 22nd okay we start april 9th april 22nd april 22nd was a was very interesting because people aren't aware of this the market actually generated a bear market and a significant correction

over the last month. Now, what do I mean by that? We know about the bear market, right? NASDAQ down 24%. What do I mean by the significant correction? S&P rallied 9% into April 9th and pulled back over 5.4% into April 21st. NASDAQ gained 12% in April 9th, pulled back 7.4% into April 21st. So the point being that April 21st was a corrective low. Besides the fact that April 8th was a bear market low, April 21st was a corrective low.

So it's part of our process. We look at corrective lows. We do the same day count. We do after bull market low. Day one after corrective low. Let's see what happens. So April 22nd was day one past the corrective low.

And the NASDAQ, and it was nine days past the bear market low. In any event, NASDAQ 100 declined 15%, held the low for nine days. Although there was a corrective low, the low on April 21st was above the low on April 8th. A higher low. It was a higher low. And our oscillator, we have an oscillator of 18 indicators, was at minus 56%. We have an oscillator that goes from minus 100 to plus 100. It was at a record low on April 8th.

of minus 100%. But what we looked for is if the market held its low for nine days, after declining 15%, and the asset was still at minus 56%, what happened in the future? In other words, the oversold held even though the market held its low. And basically, it took place at the bottom of '86, bottom of '97,

And after the bear market of 2020. So what I like about this is each of these instances was after a minor correction as opposed to a bear market. You see, the case in 86 and the case in 97 was after a minor pullback. We had a minor pullback into...

april 20 april 22nd april 21st anyway there's another indicator look at another reason for us to remain bullish of course we probably wouldn't turn bullish based on this alone if we hadn't seen bullish indicated in april 9th this alone wouldn't have turned us bullish but that's april 22nd but if you go to april 23rd we saw another reason to be long the market let me open this april 23rd signal here it is april 23rd you saw

It was 10 days after the low in NASDAQ, but VIX gained more than 9% for two days in a row 12 days ago. In other words, when VIX surges, it sometimes suggests capitulation and sometimes suggests the market's at a low, but you really can't be sure. So we look for VIX to gain at least 9% for two days in a row. Then we count the days. We count 12 days past that double surge in VIX.

When VIX gained 9% two days in a row, held its high, and NASDAQ held its low for 10 days, that's when you get this bullish signal. So let's see. This is not a perfect signal. You'll see why, but let's see what we got. Again, signal in 86, signal in 97. It's signaling in 2024. The market only gained another 9.31% to its final high before the next pullback. So that's really not a great buy signal, but certainly you want to be long, and then it's signaling just now.

So in this instance, the two cases of 86, 97, believe it or not, the market gained a maximum, a medium. The maximum gain within 12 months was 45% and 47%. I wouldn't be surprised to see the market rally 30, 40% off the April 8 lows. I'm not saying it has to happen, but based on the indicators we're looking at, it's a possibility. What could cause it on a fundamental basis?

Again, maybe Trump and Bustard, they're going to be very successful in turning this economy around. We've had a lethargic economy for decades. We're still the greatest economy in the world. But if we could go back to when we were running the economy, like we were in the late 1800s or early 1900s, you never know. Who knows? But the point being is these are just bullish indicators. And that's April 20th. So we look one day at a time. We turn bullish April 9th. We get bullish signals April 22nd, April 23rd, April 24th.

I'm going to take one that has a precedent of six prior signals. Let's take this one, April 24th. Here it is, April 24th signal. S&P declined 5% into April 21st. It's pulled back. Remember, bottom of April 8th, rallied into April 9th, pulled back to April 21st, and it's held the low of April 21st for three days. So it's a three-day count.

and the nasdaq although the s the nasdaq bottom three days ago in the sb about three days ago ninety percent of the nasdaq 100 were trading above the 10-day average so there's underlying strength in the hundred stocks in the nasdaq 100 so the me so just combining two simple indicators sp declines five percent held us low for three days the client at least five percent holds its low for three days and the nasdaq shows ninety percent of the ninety of a hundred issues

closed above the 10-day average. In this instance, it happened six times in the past. The median maximum gain was in 12 months, 24%. Why should I doubt it? Let's look at the history. October 14, 2002, three days after the low. March 12, 2009, three days after that low. November 30, 2011, three days after a corrective low, similar to our corrective low. The bottom was seen in, I think, October 30th.

But there was another pullback in November 30th, and there you see the signal three days later. February 17th, 2016, three days after that, corrective low. And here's one failed signal during the great bear market, during the short-term bear market in 2018. But this is really very dissimilar to what we had now.

because we've seen 18%, 24%, 29% decline. Over here, the decline at this point is more like 10%, 11%. But there's one failed signal. And again, you see on March 26, 2020. Again, why should I doubt it? Even if we'll ultimately will decline in this business, nothing is ever certain. There's got to be a time to take a position. And the way we see it, this is a time to take a position and to trade on the long side. So,

That's another reason we felt we have to be low on the market. Jack, any other questions you might have at this point? Yes. Milton, is there anything that you see that is making you bearish? No, nothing makes me bearish. There are things that took place at yesterday's action, but I don't think we should get there yet because let's first see, there's so many more things on the bullish ledger that people, people watching your show, for example, probably many of them are very skeptical. They have the IRAs and they have their investments and they

The advisors told them to get out of the market because of tariffs, because economic slowdown, there's going to be a Great Depression and so on and so forth. And I'm here trying to show you that we may be at the cusp of a major up move. Unfortunately, clearly at this point is the time to be owning stocks. And I just want to give some more evidence because the evidence has been continuing and growing from April 8th until recently. So let's come up to some additional factors and then I'll show you what

Why you might want to be cautious for the short term. We'll get to that. But just, yeah. So is it fair to say that the evidence that you're seeing of the bullish action in the market, would you, is it fair to characterize that as quote overwhelming? Overwhelming, yes. Oh, no. If your question was, is there anything I'm seeing that telling me that, no, everything I see is suggestive of a bull market. Everything I see.

There's nothing in what I see that suggests that we're seeing now is what they call a bear market rally. Now, we know we've had bear market rallies of 20, 30% in the past. So someone who's superficial could say the S&P is up 17% or up 18%. I think it's up 17% in the test that it's close or if it's low. That's a good bear market rally. Now we're going to head back down into a depression. There were three 25% rallies during the Great Depression.

If you start counting from the crash of 29, there were three 25% rallies and one 50% rally, which was just a bear market rally. Anyone could be superficially argued, oh, it's just a bear market rally. We see nothing in our indicators that suggests that what we're seeing now is a bear market rally. And Milton, in a bear market rally, what do you see that is typical of a bear market rally that you don't see now? Just how different is-

you certainly see tepid upside-down state volume and also you see an early emergence of bullishness in the bear market rally. And now we're seeing no early emergence of bullishness. As I said, this week's Barron's shows the highest number of bears in 30 years. And the other surveys as well are showing more bears than bulls. With the market up 17%, you'd think that would change. And I see my clients, unfortunately, I present this to some of my clients and some of my clients were shorting this rally.

No, I can't tell them what to do, but some of them have been doing that. They're very skeptical. Everyone has their own mind and I may be proven wrong at the end. Markets are uncertain and I may be proven wrong, but I have no reason to doubt what I'm seeing and what I'm saying. The market may ultimately decline, but if it declines, I'd say I didn't see it and everything is probability. Let's put an example. If Pakistan and India start a nuclear war,

Maybe that would have affected the market, right? If Iran, if Russia smuggles a nuclear weapon to Iran and Iran decides to bomb one of its neighbors, that would also negatively affect the market. I wouldn't see it in my data. So that's where I live. But based on economic data, based on what the market knows and how the market acts, there's no reason to doubt that.

that a new bull market has continued again i say new market i think we'll make new highs in the market whether or not we rally for the next two three years i don't necessarily think that's going to happen it may just be a final blow off like we saw in 87 i have no way of knowing that at this point so your level of confidence is in the short term let's i'm going to say six months on a

on a two to three year basis, you don't have confidence to say the bull market will continue, but you are extraordinarily confident, basically as confident as you can be that short term, a few quarters or six months. This is bullish action. Yes. And most of the evidence I see is suggesting that the market will last far more than six months, but knowing history and knowing limitations to the kind of work that I do, if the market's up 30% in six months, that suffices, that satisfies the message of the indicators, even though in the past the

the market may have gained 30% over three or four years. I understand. And Milton, so two things that I see in your signals in the market right now, one now is extraordinary amounts of bullish volumes. The stocks that are going up exceed the stocks that are going down. Other technical analysts, you'll refer to that as the advanced decline line. You take it a step further and you look at the volume of those shares, not just the number. And that also is extraordinarily bullish. And then the second thing, I think I would call it scale, just the

The fact that the lows are holding and that every day the market appears to be inching higher. And there's nothing right here in this chart. Let's look at this chart. Something else we didn't discuss. Look at this one. SAP declined 5%. This is April 25th. Held a low for four days. Over that four-day period, Nasdaq gained 1.25% at a minimum each day for four days in a row. Now, just gaining one and a quarter percent four days in a row is a very rare event. To take place the first four days after 5% or greater correction is...

It only happened once before. So people say, "It only happened once before. It's meaningless." No, it's not meaningless because what we're looking for is a market of one and a quarter percent for four days is bullish action. A market holding is low for four days is bullish action when combined with the right data. Let's see when this happened in the past. It happened on April 2nd, 1980 after a very sharp correction. It was a sharp, I think this was the bunker hunt correction, the silver panic. I don't know if your viewers are aware of the silver panic.

But silver trade up to $50 right up at this point. It went from $5 to $50 in the course of two years. And there was an oil man in Texas who put his whole fortune into silver. And the board of directors of the COMEX manipulated the market, bankrupted the guy.

And at that time, there was a panic in the stock market, declined 27%. But the point being is, off that low, the Nasdaq gained 1.25% for four days in a row, four days after a correction. And it's the only other time we've seen it. It was bullish then, no reason to think it's not bullish at this point. Got it? Yes. Guess what? We're outperforming what we did then. See that? This is the spider chart. The blue is history. And the black is where we are today. It's not including yesterday's trade.

And in that particular instance, the market gained 36.85% within a year. I don't see why it can't do that this time. I'm not saying it will do. I don't see why it can't do that. That's April 25th. Now let's take it a little further because April 30th. Let me get some nice signals on April 30th. Yeah, let's try this one. It's five historical precedents. April 30th, S&P had declined 5% after April 21st, held the low for seven days. The S&P 1500, which includes the S&P 600, 400, and 500,

Small caps, mid caps and large caps. It's the S&P 1500. On a six day over 18 day basis, we call it deviation from trend thrust of 3%. What does that mean? Just explain it in simple terms, please. Simple terms means on a six day basis, its action on six days relative to 18 days was superb. That's what it means. If you look at a six day action relative to its 18 days of action, it was superb action. In this case,

The average return was 3% greater over the six days than it was over the 18 days average on an average basis. Six-day average return over 18-day average return was 3% greater, even though the 18 days is including the six days. You should reduce the average. Anyway, it's called deviation from trend. At the same time, the S&P gained 9% off its last 10% decline at a new recovery high. Now, there's three things you're looking for.

with the sp to close up at least nine percent off this last ten percent correction and today was a new recovery high not yesterday not two days ago so on april 3rd the sp closed at a new recovery high of at least nine percent off its previous law number one number two is the sb 1500 on a six day basis or rate to him basis showed a upside thrust and number three is the sfp held the five cent correction for seven days this has happened five times in the past

And let's look at them again. It happened after the 1998 low, the pullback off the low. It happened after the test of the low in 2003. It happened on March 18, 2009, which was seven days off that bear market low. It happened after a 7% pullback in 2009. And it happened off the corrective low on October 12, 2011. And it happened now. Why should I doubt it?

Why should I worry about tariffs and worry about depressions and worry about moving averages or whatever else people are worrying about? The market can't decline because it's up nine days in a row. Why should I worry about that? I'm just looking at my indicators. They're going to tell me the market's headed high. In this instance, the median gain over the next 12 months was 32.8%. Now, I think it could happen. Whether it will happen or not, I don't know.

But if you're not going to be positioned for it to happen, even if it does happen, you won't capitalize on it. We believe this is another indication. That's one April 30th. We had about seven, no, about 10 buy signals on April 30th. Let me find another one. And we're, so you've talked about several, many indicators, all buy signals in April. We're recording in the middle of May. You haven't even gotten to May yet, but- No, no, I haven't told you everything. I'm just showing you select ones. I'm not showing, let me show you another one here. This is a cluster. These are clusters. Yeah. Let me show you this one.

Very simple again, this is just the opposite of what I told you earlier about trends. So this is good because we're showing the other side of trend. This is on April 30th, right? Which was seven days off the April 21st low. Which wasn't the low, but it was a relative low. Yes. The market pulled back. NASDAQ pulled back 7%, 7.4%. That's a nice pullback. I promise you that clients of mine and people who watch your show will

thought that's the beginning of the continued bear market decline. And he did, and I include myself, and I was wrong, and I'm very open to the possibility that Milton Berger is right, and I'm wrong. Very, very open to that possibility. And people should too. We'll see. But it was NASDAQ 100, 90 of its 100 stocks were above its 10-day moving average, number one, 10-day average, number one. Number two is one-day trend was above 2.20. Now, one-day trend above 2.20 means this heavy selling volume, heavy selling pressure,

and the SP500. So rather than being bullish and buying stocks and creating a thrust, a low trend, people were selling, putting their highest volume into the stocks that were down. See? Rather than putting the highest volume in the stocks that were up, a trend above 2.20 means they're putting their volume into stocks that were down.

So here you have the market has bottomed. It rallied, pulled back, made a secondary low, rallying again. And 90% of the NASDAQ is above 10% yet. On this particular day, traders and investors are putting the volume into stocks that are down on the day. It means they're selling stocks that are down on the day. Now the S&P and...

the S&P gained 9% over its last 10% decline to a new recovery high. So April 30th, so new high in the S&P 500. As you have a new recovery high, S&P 500 started to the 90 of 100 of the NASDAQ 100 were above the 10, the average. But for some reason, people were placing downside bets, high volume downside bets, call it a bet, selling in a handful of stocks. Now this happened, you notice how this cluster around

This clusters around bottoms right over here. You see right over here, right over here. Now, in our case, it didn't cluster. It happened once, but in the past, it's already been bullish. Why should I doubt it? Let's look at the past. March 21st, 2003, alpha bottom. May 3rd, 2003, market continues higher.

March 7, 2009, after bear market bottom. March 26, after bear market bottom. March, June 1, 2009. Now, of course, the market pulled back 6%. That doesn't mean anything. That's just a random pullback. This is telling you the market's heading up another 29% in the next year. Here's again, July 20, 2009, after short, sharp correction.

and April 14th, 2020 after the COVID crisis. And again, you see it now. So my question again is why should I doubt these indicators? I'm not creating the kind of things people say every January 15th to March 16th, March 20th, the S&P was down. It's going to go down. We're not talking about things that make no sense. We're talking about a combination of logical indicators

that we've worked on over the years to discover and to put together to create indicators. And this is why our institutional clients use us because these are things they're not going to get by looking at charts. You only get it by seeing data and understanding how markets work. So again, is there a reason to doubt this? No. Let's look at the SPDR chart. We're right here in the middle. So we're doing fine. Again, this is not including yesterday's 3% gain. We're doing what's expected. So what to worry about?

April 30th. Let me show you something else in April 30th, because again, we got many signals April 30th. Oh, here's 12 precedents, 13 signals. There's another one. This isn't as great, but it still makes the point. Just two things combined together. S&P declined 5% health flow for seven days. On day seven, the S&P had gained 9% over its last 10% decline. Off the lows in 74, off a correction in 75, off the lows in 82.

Here it pulled back another 7%, but again, it's early in the bull market. This is in 1988. This is after correction in 1991, straight up. This is after correction in 1998. Now, this is, again, this is a very important time for the market because let me just show you. The 2002 low was a developing low. Its first low was in July. Second low was in October. The last low was in March.

So from here to here was a 2.8% drop. From low in July to the low in October was a 2.81% drop. This signal basically told you an area of a low, but the final low wasn't in. But anyway, you got the signal then too. You got the signal off the low in October of 2002. You got the signal off the corrective, the test of the low in March 20, 2003. March 18, 2009. Anyway, again,

Nine out of 10 times, the market went straight up. Why should I doubt? And look where we are now. We're way ahead of the cases where I wouldn't say they failed, but they pulled back. None of these cases, they failed because the worst you saw over the next 10 months is up 10%, you see? The median gain was an extra 27%. So when you see all these kind of indicators, why tell yourself there's going to be a Great Depression because of tariffs?

Rather tell yourself the market is smarter than I am and the economists have a very poor track record in predicting rate depressions. That's the way we look at it. And Milton, what's your level of confidence that the low that we saw in the NASDAQ, in the Russell, and most importantly, in the S&P 500, I believe that low was probably on April 8th or maybe April 7th. It was actually the low and the market won't go down by more than that, for example, in the S&P 500.

I have that the low, according to my chart, was on Tuesday, April 8th, and just below 5,000, 4,960. But I know on an intraday basis, probably the low is actually even lower. So what's your level of confidence that- Considering the lows have held and considering the market has gained 17% and considering the kind of action we've seen, there'd be no historical precedence for the market to generate a lower low. There's absolutely no historical precedence.

based on one or two indicators, there is a historical precedent, but based on the cluster of indicators, I have to say there's no historical precedence for the market to generate a lower low. By the way, just to let you know, on April 9th, after the close, in a report on April 10th, I told my clients the smartest thing to do at this point would be to sell puts against the April 8th low, because that low should not be violated. Even on April 9th alone, we saw that, but the confidence wouldn't have been 100% like it is now, but

I clearly wrote to my institutional clients, the clearest thing to do, because by the way, put premiums are very high on April 10th. They deserve to be high. The market just went up 10%. I said the clearest thing to do would be to sell puts against the April 8th intraday lows.

which in retrospect would have been a great thing to do. That is a great call, Milton. Congratulations on the call. And people who got that call were well advised by you. So Milton, but going back to 1957, based on everything you've seen in the American stock market, you can say that you are very confident. It would be the first time that your signals have been violated, that there will be not a low again. You're confident the lows are going to hold. Yes. If there would have been a low, we should have seen it by now. And we should not have seen the type of bullish indications we've seen. So I would say yes.

Based on history, we cannot expect a low, low. Again, it's all probability. No such thing as 100% probability in the stock market. But there's many instances where there's 100% probability, but not when it comes to the stock market. In science, there are many 100% probabilities that people don't recognize. If you want to talk about science, you can get to that in a moment, but...

Yeah. And I met a very smart scientist over the weekend who's actually a listener to my show. And he's a fan of you, Milton. So I told him he was excited that you're on. And he said that the reputation that doctors and lawyers, but in particular scientists and doctors, often are not so good traders because in the world of science, there's certainty or near certainty, whereas in the world of markets...

The highest conviction thing you could have sometimes is 60 or 70%, not 100% certainty. Well, my conviction, based on history, it's 100% probability, but that doesn't mean that things could change. Stock market is not like a pair of dice. A pair of dice, you know exactly what the probabilities are. Stock market probabilities change over time. Historically, up until the 1950s, anytime the stock market yield was below the bond market yield, you had a bear market.

That was one of Benjamin Graham's great insights of the stock market. And that was a valuation signal because the stocks were overvalued relative to bonds, which of course is extremely true now. Yeah, but we get more and more overvalued in each cycle. What are you going to do about it? Warren Buffett, he's one of the greatest investors of all time, but he's banking on a crisis. He's using valuation. He's a market timer. He's using valuation to time markets and he's raised $300 billion in cash.

And you had a 18% pullback and he had a 24% pullback in the housing. It's not enough for him because he wants valuations to get cheap. Now, you're not going to get as cheap as it got in 1977, 1978. It's just, you can't expect that to happen.

There are other people, I don't want to mention names. There are some people who've made a reputation on being value investors and they've been bearish on the market for two decades already. You probably know who I'm talking about. One of the mutual fund managers in the newsletter. Evaluations change, but technical indicators don't change as much as valuation change because human nature doesn't change. And the technical indicators really are just showing human nature. If you have 90 times as much upside volume, the SBA's downside volume,

It's because for some reason, there's a compelling reason to buy stocks.

an emotional compelling reason to buy stocks, which often is followed by a higher market. I'll just say quickly on valuation that the market is more expensive than it has been historically. But in the 1950s and 60s, the market was dominated by industrial companies that were cyclical and had lower profit margins. And now the S&P is dominated by companies that are generally of a higher quality and are somewhat less cyclical and have a higher profit margin. So just because the valuation is more expensive, you're not comparing apples to apples necessarily. Right, right. Okay.

A good portion of our market movement has been technology companies. Technology companies, first of all, have very little debt. And in the past, industrial companies used to run on debt. And secondly, they have great profit margins. They don't have plants and equipment. It doesn't take as much of their, as much of the capital as it, as markets in the pay. And markets have changed and the economy has changed.

clearly has changed. Yes. And a lot of the technology companies are service companies, which tariffs, to the best of my knowledge, do not apply to. With the exception of Apple, Apple made a lot of, sells a lot of phones that are made in China. So I was worried about Apple and I temporarily shorted Apple, which I lost money on. I wish I was an MB Advisors client. Maybe I would have avoided that.

But a lot of the S&P 500 service companies are somewhat not affected by tariffs directly. Now, indirectly is a different story. But we're wading too far into fundamentals, Milton. You're not a fundamentals guy. You're a technical guy. I'm a fundamentals guy, but you can't invest in trade based on it. I happen to be very interested in fundamentals, but the opinions of fundamentals are meaningless. And again, economists are really terrible in forecasting the economy. So why should a non-economist do a better job than the economist? Leave it to them. Okay, let's look at this. This is the fifth.

Okay, we were again the market bottom is April 8th, May 5th, it's almost a month later. Now, there's something we call a regime of high volume. In other words, as I pointed out, market trading points often occur with five-day volume greatest in one year, two years, three years, history and so on. We look for a regime. If the five-day volume was at a 375-day high sometime in the past 20 days, we call that a regime of high volume. We're in a high volume environment.

so on may 5th we were still in a high volume environment because on april 8th april 9th actually you saw the five-day volume of the s p and new york stock exchange at its highest in actually over five years actually it was highest in history i'm not so sure but certainly highest in five years the same time a multi-cap index now this multi-cap index actually is run by ned davis research

They have a multi-cap index, which is a broad index of large cap, mid cap, and small cap stocks. This broad cap, this broad index generated a 10-day breadth thrust of 2.04 to 1.

So we just looked at when in the past did you see this breath thrust occur during a high volume regime? Very simple. Some people, the breath thrust alone, like you've heard that there's white thrust. Marty was pretty lucky to have these technical indicators named after him. It's pretty, pretty cool. But anyway, he had this white thrust, but this is similar to this white thrust. We're not looking at New York Stock Exchange. You're looking at the multi-cap index. But we're combining it with we want to take place during a regime of high volume.

This has happened 10 times in the past. It happened on May 5th. On May 5th, you saw a 10-day de-thrust, and you're still in a regime of high volume. And as you can see, you saw that in 82 low, 82, again in 87, breaking out to the final blow of high.

1991, all doing bull markets. You see now this is the only case where we only gained 8.6% to the final high, but you never pulled back more than six and three quarter percent. Or you didn't get a really bear market after this. This low here was only slightly below this low here. In other words, for an investor who held stocks, he would have quite well over the long term, although he would have pulled back a little bit. In any event, again, I say, why doubt it? Another buy signal. Here's where we are.

This is 87, 87 it peaked back in August. So I don't know, maybe we'll just be like 87 where we just rally 30% into the final high. But rather than over two years, maybe we'll do it over a half year. I don't know. Yeah. Milton, what is this talk of 1987? I feel like you're sounding like the most bullish you've ever been, but then out of this, I hear 1987. I feel about 87 because...

This is something I didn't want to get into, but I will because I don't have, the data's in my head. The data isn't on paper. There was something very negative about this market decline. The market decline from January to April or from wherever you look at, there's something very negative that's taking place throughout the decline. What's that? And that is that the retail investors were buying the decline generally. On a net basis, retail investors were

or putting money into their IRAs and buying the decline. Not saying the traders were doing it. Traders were panicking and getting out. But the long-term retail investor who was taught to buy pullbacks was buying this pullback. Okay? I don't have the data in chart form or in data form to show it to you, but I know this for a fact based on the data that I look at. And that was not typical. That does not usually occur at major long-term trading points in the markets.

Usually the final capitulation is a capitulation of those long-term investors who always train themselves to buy the dips. Now, maybe the reason was because the dip was only a

two months decline. They didn't have time to compete. I don't know, but that's in the back of my head telling you that maybe we're going to need, maybe we'll blow off to a high and pull back, but I'm not projecting that. I'm just saying it could happen. Of course, in some of our instances, the charts we're looking at, we've seen that happen, but I'm not necessarily saying that will happen. Yes. Anyway, that is, that is May, May 6th and let me just, May 5th and let's get to May 6th. That's the more buy signals. I think we should now, I think we did enough for this. What do you think, Jack?

We did a lot. We did a lot. But both signals, what makes sense? Let me tell you what the problem is. We had a bit of a problem yesterday. Okay. Yeah. Okay. So we're recording May 13th. The problem was on May 12th. What's the problem in this week? Yesterday. First of all, today's a great day. Marks up 1%. Yesterday was an unbelievable good day in the market because yesterday was up 3.26%. Volume surged 60% over its prior day. That's the S&P. The NASDAQ.

also had a great day because the nasdaq gained gained 4.35 percent in the volume surge 27 what could go wrong yesterday the s p and the q's the spies and the cues everyone knows what the spies and the cues are right yep s p y is s p q's isn't the nasdaq 100 not the nasdaq composite right the spies and the cues gapped up what a gap means is os price yesterday was above the highest price of the previous day

on an intraday basis, yesterday's lowest price for the SPYs was above its highest price of the prior day. Okay. So too the Qs, the highest price for the Qs on the, the lowest price for the Qs of the 12th was above its highest price intraday on the ninth. That sounds bullish to me. Why is it not bullish? That sounds bullish. That's a gap because gaps are turning point indicators. Gaps take place both at bottoms and at tops.

Gaps almost take a minute. Secondly, volume was up 50% on the day in the S&P 500. So you think that's bullish. Let's see in the past, when have we seen both the SPY and the Q's create an upside gap at the same time volume was up 50%? And just taking a quick look without breaking it down, look at this. You saw it twice during the bear market of 2000 to 2002. You saw it during the bear market

of during the COVID bear market. Let's go through the individual charts. April 8th, 2001, it was at a bear market rally. April 14th, 2002, it was at a bear market rally. Of course, it was off the lows, but these are good signals, but here's a bad signal. The market only gained another 4% before it declined 30%. You see right here, this is before the COVID top. Gap right here, same indicator. So this is bullish. So it's mixed, sometimes bullish, sometimes bearish.

So for someone who wants to be bearish, you could say, wow, yesterday was capitulation to the upside. Gaps take place, the capitulation. It's either capitulation to the upside or capitulation to the downside. This may have been a sign of a capitulation to the upside, which suggests a pullback, number one. That's one thing, okay? Okay. Let's get something else. More gap trouble yesterday. Now, I want to point out this is the first sign of negatives I've seen since the April 8th low.

Yesterday was the first time I've seen it. That's number one. Both the SPY and the Q's gap to the upside, and NASDAQ generated second highest gain in 350 days. You'd think that's bullish, right? Second highest gain, greatest gain in the last 250 days was on April 9th, up 12%. Yesterday gained 4.35%. The second greatest gain in 350 days. You'd think that's bullish. Look at that. At the top in 2008. See that? November 20th, 2007.

In each case, the market declined another 50%. So, of course, it also took place at bullish time. But again, if you want to be cautious, you have reason to be cautious after yesterday's action. Let's see another one.

Another gap trouble. This one. S&P gained 17% into a new high, which was on April 12th, May 12th, S&P had gained 17% into a new high. It gained 17% off its last 10% correction into a new recovery high. Volume was at 50% at the day and the Qs generated an upside gap. When did that happen? It happened, the market did gain another 7%, but it happened into the top of 2011. It happened 5% below the top, the COVID top.

And it happened November 6, 2004, the market another 3.6%. In this case, October 2nd, another 1.6% to the top. So this is a reason you might want to be cautious. Let's see another one. Now I have a, oh, this is a good one because I'm going to teach when your clients tell me they've never heard of before. Because everything else is simple. It's also simple, but it's proprietary. I don't think I ever shared this with anybody.

Most advanced decline line, familiar with the advanced decline line? Or should I describe it a bit? Sure, sure. Advanced decline line is on any given day, let's look at the S&P 500. If 400 stocks are up and 100 stocks are down, so that's a net positive of 300, 400 up, 100 down. If you saw next day, same thing, net positive three, add the two together, you get 600. And that's called the cumulative advanced decline line. You're adding or subtracting the net difference between advancing stocks and declining stocks.

And many technicians on your show have used it, have discussed the advanced decline line. They say it leads the market and so on and so forth. We've created an advanced decline line that does not look at every stock in the S&P 500. It only looks at stocks that are either up a half a percent or more or down a half a percent or more. We're ignoring the bulk of stocks in the S&P 500.

and we're doing a count only on stocks that have moved at least half a percent on the day okay it's a proprietary measure of the ad line it serves us very well and in this case what happened was that at the close of trading yesterday close of trading on the 12th of may the fifth one half percent

a d line in other words if you relate the number of stocks up and down half a percent up or down for the last 15 days you got a 2.2 over one breath rust in other words you got something that should be bullish however as i said in one of my one of my reports i published was the was called it was called the boundaries of technical analysis you can get on the internet boundaries of publishers for the mta which is the market tech the technical association so i there point out many indicators

single both the bottoms and the tops you have to really differentiate where you are anyway in this case you had an upside gap in the spy not saying after the cues you had a breath rust

in the proprietary advanced decline line. And look, it only happened once before in history. Look at it right here. It happened at exact top of July 7th, 2011, before a 19% decline in the S&P. What was that? Was that the flash crash? No, this was the German bank panic. Okay. 2011 is when they thought the German banks were going under. It was a continuation of financial crisis, believe it or not, the way I recall. You could look it up, but I recall it was a financial crisis in Europe.

which took the German DAX down 34%. The S&P only declined 19%, but I think now it's declined in the 20s. But in any event, it was just a day before the top. Actually, the top was in April. The secondary top was in July. It's just at the top. So this happened only once before a gap, and gaps take place at turning points. Breath thrust shouldn't take place at turning points, but they can. And this is another reason. If someone wants to be cautious, now fortunately the market was up today. It's still up today. It's up now.

47 percent up 1.83 percent in an aztec so you're really not following that pattern but i'm giving you reasons to be cautious based on yesterday's action let me see if there's anything else here yesterday no this is this is more bullish okay anyway i'm just going to show you i don't want to i don't want to give you the impression that i'm bearish i can show you many bullishings happened yesterday as well here look at this is bullish sp up 17 to a new high recovery high and the sp 400 and 600 each are 300 in the day

Look at that. It happens in bullish, bullish, bullish, bullish, bullish, bullish, only bullish. Okay. Here we're at the end of the bull move in 2024. But most of the cases, as you see, it takes place when the market's going to rally. So you can find bullish things yesterday. But for the first time in this rally, I've seen things that are potentially bearish, not changing my view at all. I still buy pullbacks. I still think we're in a bull market. I still think things will look very great for the stock market. And I imagine things are going to look great for the economy if this bull market will continue.

Okay. So you're grasping for reasons to be bearish. You haven't been able to find any other than the readings you've had on May 12th. But even despite those readings, you're still overwhelmingly bullish, yes? Exactly. Exactly. Exactly. How are you thinking about Bitcoin and gold? Or is there anything else technical that you're seeing that's interesting to you outside of the stock market? I don't want to comment on Bitcoin because I'm in Warren Buffett's camp and Charlie Munger's camp.

that the whole thing makes no sense. And I'm proven wrong because people don't buy and sell things with Bitcoin, but they trade. It's proven to be a great trading vehicle. But I do have a lot of expertise in gold.

I think gold is in a sense overvalued. I don't think gold is the beginning of a bull move. I think gold is the end of a bull move and I'll try to get, I'm going to pick up a chart in one minute. I'll have the charts for you. Gold unlike stocks and unlike, unlike stocks, gold is doesn't create any, any retained earnings and just shoot off any dividends. You have a company like Apple or any company, they earn money and the money they retain some earnings that earnings increases the value of the company.

The only reason the gold value increases is either because of inflation or because people are buying gold and raising the price. So what we see in gold now is, although gold has had a remarkable run, we track gold based on the standard CPI, government CPI, and we track gold based on the shadow stat CPI. And in both instances, gold is at historic highs relative to CPI. So we see very little reason to expect to continue to bull move in gold.

So we're actually negative on gold. I don't have the charts prepared. I didn't want to prepare anything in gold now because I wanted to focus on stocks. Maybe we'll do that another time, but I am not bullish on gold at all. Despite the fact that gold has had a good run, I think it had a good run taking it to an overvalued area. So Milton, you said you're not terribly bullish on gold. Actually, you said you're

pretty bearish on gold. But Milton, when you talk about inflation relative to gold, I worry that you're leaving your world where you are the king of the world of the Miltonberg technical analysis school. And then you're talking about inflation. And that's a little bit more macro. The two often diverge. For example, in 2022, gold's supposed to be an inflation hedge, right? But gold actually faltered in 2022. And also, actually, interesting, gold miners did

quite poorly in 2022 because actually there was a lot of inflation, but the inflation went through to oil and to labor costs. So to operate a gold mine, it actually increased those costs. So they're not always- You're actually making my point. You're actually making my point. Let me tell you how you're making my point, Jack. I totally agree with you. And you're actually proving my point. First, gold peaked in 1980 at $850 an ounce and declined for the next 20 years until it got to roughly $240 an ounce in the year 2000.

During that 20 years, the CPI price index in the United States doubled. So here you see gold down from $8.50 to $2.50, which is more than the halving of gold. And at the same time, the CPI price index doubled. So to argue that gold is an inflation hedge, you can't argue that. I'm not making the argument. I'm making the argument is that the reason gold was able to decline in the face of a continued inflation from 1980 to the year 2000 was because at its peak in 1980, gold had outpaced the inflation rate.

and i'm saying the same thing gold from the year 2000 where it bottomed to 2025 where it may be peaking has again outpaced the inflation rate to a similar extent

at which it outpaced the inflation rate at its 1980 peak. - Nelson, what about your technical analysis of gold, setting the macro aside? - Technical analysis of gold is it's a commodity. Gold is a commodity and commodities peak on high momentum. Commodities don't peak on low momentum. Stocks peak on low momentum. Stocks peaks at divergences in low momentum. Commodities peak, unlike stocks, they peak on high momentum. So the movement in gold into the latest peak

is a high momentum peak. So that's consistent with the idea that gold is topping. I know that Scott Besson, I think publicly stated that he's bullish on gold. Maybe that's no longer the case. Now he's in government, he's going to bring the price of inflation down, the rate of inflation down, I don't know. The many hedge fund operators that are bullish on gold

And if you've been bullish in gold for a few years, you did well. If you're trading bullish in gold now, no, now's not the time to make the bet at all in gold. Jack, I have an old chart back in February of last year, but I'll just discuss it because this is the chart I'm talking about. Jack, you there? Yep, I'm here. Here we go. This is day 3724. What I'm looking at is

This is the ratio of gold to CPI inflation. This is the peak in 1980, right here. The ratio of US CPI inflation. So when gold picked in 1980, the reason it declined for 20 years was because the way out placed historical inflation. It got through this peak. This is in December, bless you. Now, if I have to draw it, the line goes up to here. Now we're up to here. See? So now we're overvalued relative to CPI inflation than we were at the 1980 peak.

Got it? So, though you can argue, wow, look at gold. It had a consolidation, a breakout, and it should be headed much higher. Yes, that's true. If you look at the price itself, we look at the price relative to CPI, you don't break out. You get into an overboard range relative to inflation. Now, this is just one other thing we looked at that tells us negative. I think on a commodity, on a trading basis, you look at the gold chart, the momentum has increased into this high.

to the latest targets, so increasing momentum rather than the decrease and commodities peak on increasing momentum. Now this is CPI inflation. The argument people are making is, hey Milton, CPI inflation is wrong. I agree, CPI inflation is wrong, but we've tracked it relative to the Shadowstats Inflation, which is an organization that tracks their own rate of inflation.

And in that instance, gold has again become overvalued relative to that measure of inflation as well. Maybe not as much as it was in 1980, but it certainly is overvalued, far more overvalued now than it was over the last

25 years. Okay. So you're bearing gold, Milton. I feel like the tables have now turned. We were in a reverse situation because earlier I was saying, but the fundamental case is bearish for equities, tariffs to this, tariffs to that. You're saying, I'm just looking at the technicals. Now, I think you're making a fundamental case for gold, talking about- The technicals is that you have this high momentum into a peak. You have everyone talking about gold. You have people. And another technical is that there's aversion between gold and gold stocks. People are saying, hey, gold stocks are going to catch up. No,

This is divergence. Gold stocks won't catch up. Gold will catch down.

So that's another technical aspect in looking at gold relative to, look at your gold prices relative to the gold stock prices. No, I would say I'm using fundamental data, but I'm not trading based on inflation. I'm trading based on how gold trades relative to this fundamental data. I'm not saying gold has anything to do with inflation. I'm saying is that gold, since gold is not a stock which has retained earnings and dividends, but gold just basically just trades based on

people are willing to buy and sell. So when you have gold at a certain price relative to historical inflation, there are more people who are willing to sell. And secondly, by virtue of the fact that the momentum of gold has increased into these highs, gives you the signs of a top. Let me see if there's any, I think I actually saw a gap in gold. Give me one second. It did gap. And let me see, XAU currency.

And then you had the spike. People look at the momentum from April 7th until April 22nd was greatest in the run. So I think it's likely that gold is topping as a commodity. Milton, what would you have to see for you to get more cautious on the market?

Number one, I can't see a Barron's headline saying most beers in 35 years. You're going to have to see people turning bullish, number one. Number two is usually the markets peak when the economic news is good. And now at least the headline news is good. Now the headline news is constantly negative. And you're going to have to see people, the headline news saying, wow, inflation is down and the economy is strong. And you see upside earnings surprises. That's really when markets peak.

But technically, you're going to have to see deterioration, divergences and deterioration. We have a list of about 40 indicators we look at for market peaks and rising relative to stocks. Many things we look at. Nothing once specific, but really not there yet at all. I must say we're not there yet at all. I can't give anyone specifically to look at. Wait for the sentiment to turn. Wait for the people you interview to turn bullish. That's the first thing you're going to have to see.

I'm not included in that. You're not included in that? I have to say, yeah, I've done a lot of bearish interviews over the past month. I thought that I was accurately covering things given the quite negative news flow on tariffs and the market action, but I was definitely caught off sides as an investor as well as a podcast host. So I'm really glad that you've been here, Milton, to see us through it.

add some balance. I'll have you back in six months and we'll see what happens. Miltenberg, where can people find you on Twitter and how can people learn more about your research? Well, we just do www.miltenberg.com. Their institutions can contact us.

And we have, we do Twitter feed. I think it's at Berg Milton. I'm not even sure. I look up my name, Milton Berg. And eventually we'll have more. Right now our only product is an institutional product at this moment, but that may change in the near future. And Milton, were you writing a book about technical indicators? Yes, yes. But the things I show you are all going to be in the book, but I can't, the book will take thousands and thousands of pages. So I'm right now figuring out how to consolidate it and make it readable. It can't be a book that's part written book, part printed book and part internet book.

I can't put all the data in a written book. It's just impossible. Milton, how many indicators do you have? And yeah, how many pieces of paper do you have in your office with the different indicators? No, we have 30,000 indicators that we track, but the signals we use are combination indicators, as you see. Nearly all the indicators I showed you today was a combination of one, two, or three indicators. And they're really simple indicators, and you really have to know how to look at them. You can't just look at a chart and have an indicator.

No, we have more than you can count to say, to be honest. But not more than you can count. No, no, more than I can keep in my head. I got to really have it computerized. I can't keep it in my head. I used to be able to keep it in my head, but not any longer. How many indicators can you keep in your head?

I don't know. I keep many indicators in my head, but no longer can I keep all the indicators in my head. You can't keep 30,000. 30,000 is too much even for you. Milton, my final question. What about international markets? A lot of headlines about investors getting skittish on US equities. They're diverting. They're investing in Japan, in China, in Europe. Foreign investors are maybe pulling a little bit of their money out of the US market. The stock market at a time was weakening alongside the US dollar. What's your technical analysis of foreign markets, whether it's in Europe, the German market, the Japanese market, the Chinese market? What's your analysis?

There's a good technical reason to be involved in foreign markets, simply because of their underperformance relative to US markets for decades and decades and decades. On the other hand, that's never enough. That's a valuation process. That's never enough to get into a market. You have to see the kind of indicators during bull markets. We have exposure to China, by the way. In our long-running portfolio, we have 15% to 20% exposure to China, just in a few stocks. We own, of course, Alibaba. We own Futu. It's a brokerage stock. We own Ator, which is a

domestic touring company. They generate tours for the over 1 billion Chinese residents. We think China is a good buy. I know my friend Stan Druckenmiller doesn't want to invest in China because of the dictatorship. He has probably higher standards than I have.

But we do our recommending Chinese stocks. As far as Europe and so on, I haven't seen the kind of... Europe has been tracking America just to a lesser extent. Our bull markets have been accompanied by bull markets in Europe. So I'm not so sure that I want to invest in Europe. But China has been going contrary to US markets. I think China has been a buy over the last year or two, and we've recommended Chinese stocks.

And yeah, I've asked Scott Besson at a conference, now Treasury Secretary, about his view on China before he became Treasury Secretary. And he said he would not be an investor in China. Well, maybe they have higher standards than I have, fortunately for them and unfortunately for me. Higher standards than me as well. Milton, just a little bit about the fundamentals. So you think that this...

President Trump's tariff strategy is going to work out either through repatriation of manufacturing in America, which will take some time and likely perhaps some short-term pain, or through just him being able to do deals and generate revenue? I think it's an amazing idea. I think Trump's idea of tariffs is amazing. I think we've been brainwashed by the Milton Friedman free trade people that tariffs are poison. No, tariffs would be poison if the other countries didn't place tariffs on us.

We're just reciprocating. We're going to make a level playing field. I think it could be tremendous for America. And even if I didn't think so, it seemed that the market thinks so. So I think the market's acting fine, generating a great bottom. We shall see. But this is a great time in American history. We haven't had these kind of tariffs decades or centuries for as far as I know. And let's see what happens.

We shall see. And I just want to stress that, yeah, your political analysis is not informing your technical views at all. You could have someone who is totally doing something totally opposite and your read of the market would be the exact same. People can find me on Twitter at JackFarley96. Subscribe to the Monetary Matters Network. Check us out on Apple Podcasts and Spotify and please leave a rating and review. It helps the show. Until next time. Thank you, Jack. Thank you. Just close this door.