Very Overbought Stock Market Ripe For A Pullback | Lance Roberts

**Lance Roberts** (0:00)
I still believe, because momentum is very overbought here, because relative strength is very overbought here, that we could see a bit of a pullback. Back to where this deviation to the 20-day moving average is very large, the deviation to the 100 and the 50-day is very, very large. This is a very big gap over the 50-day moving average. So you're eventually going to get a correction back to this level.

**Adam Taggart** (0:31)
Welcome to Thoughtful Money, I'm Thoughtful Money Founder and your host, Adam Taggart, welcoming you here at the end of the week for another weekly market recap featuring my good friend, the Peckish portfolio manager, Lance Roberts. Lance, how you doing?

**Lance Roberts** (0:44)
Peckish is a good word for this week.

**Adam Taggart** (0:48)
Or maybe I should have said hangry?

**Lance Roberts** (0:50)
Hangry would be a better word for this week, yes. Let me just say one thing.
I saw your tweet and we can talk about this later in the show, but I saw your tweet about getting cut in your 50s. I'm 61 in May. And let me just tell you this, cauliflower rice sucks ass.

**Adam Taggart** (1:12)
And just a reminder to folks who didn't watch last week, your wife has basically instituted that you as a couple are in the process of doing a weight drop because you're going to be going to the beaches of Italy in a little bit.

**Lance Roberts** (1:26)
Exactly. And to our point of our discussion later, trying to get cut at 60 is a real challenge. So it used to be so easy when I was young.
It was like I could eat hamburgers and get cut.

**Adam Taggart** (1:39)
Oh, jeez.

**Lance Roberts** (1:40)
Not the case anymore. Anyway, we'll talk about that later.

**Adam Taggart** (1:42)
We'll talk about it later. Yeah, it was never that easy for me.
But yes, the older you get, man, the harder and harder it gets. But doesn't mean it can't happen. Again, we will talk about this at the end, hopefully, in an inspirational way for folks.

**Lance Roberts** (1:56)
By the way, if you're with me in chat about cauliflower rice, put one in the chat right now.

**Adam Taggart** (2:04)
I'm pretty sure, I don't think we're going to have too many people who are going to be champions of cauliflower rice, but I could be wrong. All right. Well, look, lots to talk about, lots still going on in the world. I guess here since we're at the first of the month, this is May Day, 1st of May, Rabbit Rabbit, if any of you follow that old tradition of saying Rabbit Rabbit at the beginning of the month for good luck.
So looking back, Lance, stocks put in their best month since 2020 So phenomenally good month for stocks, which in many ways, I think flummoxes people because that was during this whole Iran War with an oil price shock and a lot of uncertainty about where things are going, but markets sure don't care.

**Lance Roberts** (2:52)
No, they don't. And it was interesting because in March, right towards the end of March, I wrote the daily market commentary that the month of April tends to be a really good month, historically speaking, because a whole kind of lot of factors line, if you have tax refunds, those types of things. But also you had two really kind of sloppy months ahead of that, which are normally better months. So February and March tend to be okay months, they're not fantastic.
But they were pretty sloppy. March was tough. And then of course, we had that 10% drawdown. And so that kind of really set the markets up. And that was where you and I had that conversation a few weeks ago. And I said, don't be surprised if we get a 10% to 15% rally on any type of good news.

**Adam Taggart** (3:31)
Because the market's higher, I think, was your exact words.

**Lance Roberts** (3:34)
And that's just because the markets were set up for a lot of negativity, a lot of offside positioning. And then you just had the seasonally strong period coming in right on top of your earnings, getting kicked off, buybacks are going to start next week.
So, there's been some good tailwind support. But now, May, as a good example, tends to be one of the weaker months of the year. Doesn't mean it will be. But on average, May runs about a.2 to.3% average rate of return. June and July tend to be better. July tends to run closer to about 8 tenths of 1% to 1% annual. And so, when you talk about selling May go away, you're going to hear this a lot starting today. You'll hear a lot of analysis about selling May go away.