Make That 24 Out of 24

A year ago, we noted that the S&P 500 Index was up five consecutive months, and going back to 1950, it was higher a year later 23 out of 23 times that scenario occurred with an average gain of +12.9%. Well, the S&P 500 was up +13.6% a year after its most recent five-month win streak that ended in July 2016 – making that 24 out of 24.

2017 has been a very solid year for the bulls, but the big question is: how obvious were the signs? Obviously, the five-month win streak last year was a huge indication to be on the lookout for more equity strength, but were there others? If you’ve been following this blog, we identified more than a few potential clues:

Per Ryan Detrick, Senior Market Strategist, “Although we’ve gone more than nine months without so much as a 3% correction in the S&P 500, it is important to remember there were many signs over the past 12 months that suggested this bull market was far from over. As we’ve noted in the past, bull markets don’t die of old age, they die from excesses. From an accommodative Federal Reserve, to low inflation, to an expanding global earnings backdrop, to a continued ‘one foot out the door’ mentality from most investors – we simply aren’t seeing the type of excesses seen at previous major market peaks. The bull might be old, but it still has horns.”

 

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