Finally! The S&P 500 finished the day at 1530.23 - an all time high. Everybody was watching this level as it had been the line in the sand, drawn more than 7 years ago:
On March 24rd, 2000 the S&P 500 reached an intraday high of 1553 (red circle above). And for the next few months kept trying to go higher but each time it was pushed back.
In hindsight we know this level to be the last bull market top and the blow off of the internet bubble of 2000.
The interesting thing to note is that not only did the S&P 500 put in a very strong performance today, it did so in the face of some seemingly bearish cross-currents from China. Overnight, the Chinese authorities tripled their stamp tax on stock transactions in another attempt to cool the mania surging in their stock market. The Shanghai market dropped almost 7%. The last time China sneezed like that, we caught a cold (February/March 2007).
But now? We seem to have developed an immunity.
I find it still supportive that so many people, even active traders and investors, are in denial of what is right in front of their quote screens. I’ve already covered how the retail “Mom’n'Pop” investors are simply not interested. But I’m seeing much of the same from many experienced, knowledgeable market participants. They simply do not want to believe this is a bull market.
Which is more the reason why it is. And more reason why it has some ways to go.
Finally, we may very well see the market correct from this level and go into a range bound contraction as it digests the resistance. That would only be natural. In the medium to long term though, I think we are headed higher.
As I wrote yesterday, on that time horizon, it is foolish to bet against the house.
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