A lot is being made about the Dow making new all-time highs lately, but as many of you know, the S&P 500 is still about 3% below its peak from the year 2000 at the 1,527 level.
Here's a 10-year chart of the S&P 500 index:
One possible scenario would be for a long term double top around that level. A lot of strategists are dissatisfied with the 7% correction we got in March and want some kind of retest of that level, or even better, a full 10% correction in the S&P 500 so we can get that monkey off our back.
Is a double top around 1,527 the most likely scenario? Of course not, but it's still interesting to think about. I definitely would not rule it out and it would make for some good headlines. The market is clearly overbought, so if we truly need another pullback, as many seem to think we do, what better way for it to play out? It would make for a very intriguing chart pattern, one that technical analysts could cite for years.
Get Seeking Alpha Free Stock Alerts by Email!
Get Free Stock Alerts by Email!
ETFs In Focus
-
Editor's Picks
-
Most Popular
- Apocalypse Dow: The Search for Scapegoats
- This Isn't a Bottom, It's a Disturbance in The Force
- Reading the S&P 500's Crashing Waves
- On a Return to Normalcy: Dow 8,500
- Looking Back at Lehman: Lying, Scapegoating and a General Lack of Accountability
- iShares ETF Tracking Error: Risks and Explanations
- Full list of Editor's Picks »
- Nation's Debt: It's Not Being Rescued, It's Being Moved Around »
- Clueless - Cramer's Mad Money (10/8/08) »
- Cramer Should Be Suspended »
- Crazy P/E Ratios »
- This Isn't a Bottom, It's a Disturbance in The Force »
- Sirius Shares Priced Like Stamps »
- Wall Street Breakfast: Must-Know News »
- Earnings Preview: General Electric »
- Cramer: Dow Could Drop Another 14%, Oil's Going to $50 »
- 5 Reasons Stocks Will Keep Falling »
- Bulls Take a Stand - Cramer's Stop Trading! (10/10/08) »
-
Long Ideas
-
Short Ideas
-
Cramer's Picks
- 'When There's Blood in the Streets', Buy Biotech Stocks
- Midstream MLPs Crashing, Present Opportunity
- A Fresh Look at Shipping Company Stocks
- Panic Selling in InterOil: What Now?
- Potash Corp.: No Liquidity Problems Here
- The Year of the Bear
- Cobalt: More Than Just Blue
- Investors Can Find Comfort in Big Blue
- Hershey: The Perfect Recession Investment?
- Applied Materials Leads by Example
- Full list of Long Ideas »
- The Short Case for General Electric
- Too Late to Short SPY? An Historical Perspective
- Henderson Group: Profit Warning Surprises Short Investors
- Decreasing Chipotle Traffic Could Spell Trouble
- Why I Sold Lowe's Short
- Accor, Host and Marriott: Short Interest Heats Up
- Global Financial Crisis Makes Oil a Great Hedge
- Michael Page International: Stock Down on Market Weakness
- Gaming Stocks Still a Poor Bet - Barron's
- After Coming Rate Cuts, Some Appealing Short ETFs
- Full list of Short Ideas »
- Prefer a Yield - Cramer's Lightning Round (10/10/08)
- Bulls Take a Stand - Cramer's Stop Trading! (10/10/08)
- Clueless - Cramer's Mad Money (10/8/08)
- Torpedo Dry Ships - Cramer's Lightning Round (10/8/08)
- Chocolate Lover - Cramer's Mad Money (10/7/08)
- Yield is King - Cramer's Lightning Round (10/7/08)
- Goldman Disses Solar - Cramer's Stop Trading ! (10/7/08)
- Time to Hoard Cash - Cramer's Mad Money (10/6/08)
- Buyers On Strike - Cramer's Stop Trading! (10/6/08)
- Still Bullish on RIMM - Cramer's Lightning Round (10/6/08)
- Full list of Cramers Picks »
Trading Center
Hedge Fund Jobs
Job Seekers: Search jobs by category, get job alerts by email or live feed, apply online See full list of jobs »
Employers: See all recruitment options, get applications online or by email Post a job »




This article has 1 comment:
But that didn't happen and we have to contend with the real world, which today is low to moderate real GDP growth, modest CPU inflation and low to moderate long-term interest rates. So, with that in mind, an argument can be made that we are in for another period like 1966 to 1982 in which the Dow (as a proxy for the market) reaches 13,000 then backs off, tries again and so until the growth rate since 2000 begins to average out into 8% or so on average. The federal government made a mess of things that contributed to the 1966 - 1982 sickness, and it certainly can do that again. Your double-top in the S&P may not kick the market into a new long-term high growth mode after all is said and done. It will be interesting to see what happens. Thanks again for your perspective.