More of the same describes todays market action but that fails to answer why prices continue to move higher in small steps. So far, our analysis has not found an answer. Instead, we focus on 1) the ongoing recovery and 2) the distance in time and price- before values return to their previous high of March 2000.
We apply a measure better than absolute values. Such as the S&P has recovered to the 1,300 level or the last time the DJIA reached 12,000. These look back; we want measures providing better and deeper insights. A simple, yet sophisticated standard that uses the past to conjecture the future.
Consider the S&P500 and its price action in the previous, 2000/2007, price cycle. At todays close, just below 1,300, this index has recovered 83 percent of its previous, March 2000, high. The diagram displays this information, as well as revealing the horizon of future price expectations.
That operating at the previous speed and strength, it requires 364 trading to days to reach the previous all time, 2000, high. Consequently, there is ample time to recapture previous values.
There is no need to rush an order and there is history to confirm that plenty of headroom remains for appreciation.
Naturally, using these statistics requires human input and evaluation. Otherwise, for example, the NASDAQ, closing today at just 28.5 percent of its 2000 peak, appears to have an even higher limit. However, action on that basis alone means overlooking all the information history offers: that high was the result of, and occurred before, the correction for the internet/computer boom.
DJIA .04 percent
NASDAQ .58 percent
S&P500 .22 percent