Milton Berg: “Overwhelming” Evidence of Bullish Action In Stock Market
May 14, 2025
auto_awesome
Milton Berg, a pioneer in technical market analysis, discusses his bullish outlook for the stock market, emphasizing that early April marked a significant turning point. He analyzes rare market signals, including the TRIN indicator, and historical patterns that suggest a strong potential for a bull market. Despite current bearish sentiments, he points to positive trends and patterns in major indices like the NASDAQ and S&P 500. Berg also critiques the value of gold, advocating for a focus on stocks instead, while exploring international markets and their implications.
Milton Berg argues that April 9th marked a critical turning point in the stock market, signaling potential for a bullish reversal based on historical patterns.
The European Central Bank's commitment to stabilizing the euro is seen as essential for bolstering investor confidence amidst market uncertainties and bearish sentiments.
Despite prevailing bearishness among investors, technical analysis suggests potential for a significant market rebound due to strategic positioning and historical recovery signals.
Deep dives
The ECB's Commitment to the Euro
The European Central Bank (ECB) is fully dedicated to ensuring the stability of the euro, indicating a strong commitment to monetary policy and economic resilience. This readiness to act decisively reflects confidence in the economic recovery within the eurozone. The ECB's efforts are seen as crucial in countering any negative sentiments in the market, especially in times of uncertainty, such as trade disputes and economic questions. The perspective that the ECB's interventions will be sufficient to preserve the euro provides reassurance to investors amid ongoing market fluctuations.
Investor Sentiment and Market Positioning
Current sentiments among investors show an unprecedented number of bears, the highest in nearly thirty years, raising concerns about market direction. Despite this, there are professionals who remain optimistic about the market's potential for significant upward movement. The lack of bullish sentiment among a majority of investors is analyzed as a contrarian signal, indicating that the market could be poised for a historic bull run. The emphasis on positioning 150% long showcases confidence in market dynamics diverging from popular opinion.
Analyzing Market Corrections
The discussion highlights the perceived bear market conditions, particularly through the lens of major indices like the Russell 2000 and NASDAQ. While some indices demonstrated steep declines of roughly 27-30% over a four-year span, the analysis suggests these corrections were not indicative of a robust bear market but rather a period of stagnation. This history of being significantly down over long periods lays the groundwork for a forthcoming bullish phase, suggesting that such declines can precede robust recovery phases in the market cycle. The rationale is that significant corrections often create an ideal environment for market rebounds.
Historical Indicators of Reverse Market Moves
April 9th served as a critical turning point where notable technical events took place, including widespread increases in positive market volume. On this day, the market exhibited characteristics historically associated with bullish reversals, such as significant ratios of upside versus downside volume. In past occurrences, similar patterns led to robust recoveries, showcasing a median gain of over 24% within the following year. This historical precedence provides a basis for optimism regarding future market performance, despite the skepticism prevailing among retail investors.
The Role of Tariffs and Economic Policy
The conversation on tariffs casts a favorable light on the potential for domestic economic improvements, suggesting that they could protect and bolster U.S. manufacturing. A focus on fair trade as opposed to free trade highlights perceived inequalities in international economic interactions. The belief is that, rather than deter trade, tariffs can facilitate the reestablishment of a level playing field, which could lead to long-term economic benefits. Such sentiments underscore the importance of analyzing policy effects from a technical perspective rather than a purely ideological lens.
Continued Bullish Sentiment Amidst Mixed Signals
Despite a generally positive outlook, some caution has emerged from recent market actions that could indicate a shift. Bullish signals remain strong; however, concern arises from gaps and high-volume movements in pricing that historically precede corrections. These conflicting indicators suggest the possibility of temporary fluctuations before the anticipated upward trends solidify. The essence of technical analysis emphasizes the need to remain vigilant and open-minded in interpreting market dynamics for informed trading decisions.
Milton Berg, pioneer in technical market data analysis, explains why he thinks early April was a turning point in the U.S. stock market and why the stock market is likely headed higher. Recorded May 13, 2025
Follow Milton Berg on Twitter https://x.com/BergMilton
Follow Jack Farley on Twitter https://x.com/JackFarley96
Follow Monetary Matters on:
Apple Podcast https://rb.gy/s5qfyh
Spotify https://rb.gy/x56dx5
YouTube https://rb.gy/dpwxez
Remember Everything You Learn from Podcasts
Save insights instantly, chat with episodes, and build lasting knowledge - all powered by AI.
