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Tom Lee Just Called The Market Bottom

The Block Whisperer

April 28, 2025 at 3:13 PMby The Block Whisperer

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Tom Lee spots 4 rare signals flashing green—Zweig Thrust, VIX drop, credit calm & market breadth surge

Tom Lee Just Called The Market Bottom
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Fundstrat's Tom Lee just dropped his market theory, and he's not playing around with vague predictions.

The famously bullish analyst is pointing to four signals that are all flashing green at the same time – a phenomenon that hasn't occurred in years.

This time, it might be different… maybe. 

The Four Signals That Matter

First up is the Zweig Breadth Thrust, which triggered on April 24th. 

Although it may sound fancy, it essentially means the market shifted from being bearish to surprisingly bullish in under two weeks.

This phenomenon has only occurred 11 times since 1978, and every single time, the market was higher six and twelve months later.

We're talking average gains of 14.8% and 23.4% respectively – not exactly pocket change.

The Fear Gauge Is Calming Down

The VIX (aka Wall Street's fear barometer) finally dropped below 31 after hitting nearly 38 in early April.

For perspective, a high VIX means traders are freaking out, while a low VIX suggests they're getting comfy again.

This shift from panic mode to "maybe things aren't so bad" territory typically occurs just as markets are about to turn around.

Credit Markets Are Chilling Out

High-yield spreads – essentially the premium investors demand for riskier debt – have reversed 50% of their recent widening.

This is significant because when these spreads blow out, it typically means recession fears are at an all-time high.

The fact they're coming back down suggests the "R word" might be off the table for now.

The Breadth Is Back

Then we have two days where 90% of S&P 500 stocks went up, which occurred close together.

This isn't your typical tech-driven rally where five stocks do all the heavy lifting.

Since 1979, every time this pattern showed up, stocks were higher three, six, and twelve months later.

The Real Question In Play

So, are we looking at the bottom?

While Tom Lee's track record is pretty solid, remember that markets are nothing if not unpredictable, especially in this macroeconomic environment. 

These signals have been historically accurate, but nothing's guaranteed in this circus.

What is interesting is seeing all four flash at once – that's like getting a full house in poker.

And unlike crypto, these signals are based on decades of data, not vibes and short-term sentiment that can changel ike the wind.

The Decision Point For Markets

If Lee's right, we could be looking at some serious gains over the next year.

The convergence of these historically reliable signals is rare enough to make even the bears take notice.

Just remember that this is the global markets we’re talking about – not meme coins.

The ramifications of the next move will be significant, so make sure to hedge your bets accordingly.

#stocks
#investment
#technical-analysis
#market-analysis

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