Current Bear Market Rally To Bring "More Pain This Year" | Tom McClellan

Another technical analyst with yet ANOTHER different take on the markets

Wall Street is loudly wondering: Was the drop in March-April simply a correction in an otherwise intact bull market?

Or...was the recovery in May a bear market rally, one now poised to roll over?

When markets are as volatile and the macro outlook as uncertain as we've seen in the past few months, turning to the data & navigating by what it's telling us is often highly useful.

Which is why we're fortunate to have one of the best technical analysts in the industry, Tom McClellan, joining us today to share his latest interpretation of the current market action.

Tom is the latest in a stretch of technical analysts I’ve interviewed over the past week (Sven Henrich and Mark Newton being two others), and he has the most bearish outlook of the bunch.

To learn why, click here or on the video below:

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Adam’s Notes: Tom McClellan (recorded 5.22.25)

• Bearish 2025 Outlook: Tom McClellan predicts a bear market in 2025, driven by crude oil’s 10-year leading signal (2014 drop), with a potential bottom in January 2026, viewing May’s rally as a bear market rally despite strong breadth.

• Conflicting Breadth Signals: A Zweig breadth thrust post-April 8, 2025, suggests bullish liquidity, but historical exceptions (e.g., 2004, 2015, 2023) and a 2022 rally analog indicate a likely lower low by August.

• Liquidity Dynamics: Reverse repos’ declining balances (a “liquidity sponge”) fueled the rally, but recent peaks signal a downturn, while M2/GDP’s July-October 2024 bottom forecasts a stock market payback by late 2025.

• Rising Bond Yields: Gold’s surge above $3,300 predicts higher long-term bond yields post-June 2025 (20.5-month lag), with a June dip offering a trading opportunity, complicating refinancing and equity markets.

• Investment Strategy: McClellan advises