We saw half of this equation with $SPX tagging 1981 but we did not see a significant retracement of the losses, leading me to believe we are likely to see a move up to 2096 or a bit higher and then a move down before undertaking the next (last) push higher.
I have seen this little drama play out countless time within a trading cycle, making me believe it will repeat itself yet again barring major tail risks or the world imploding.
On the next push higher we should be aware of the possibilities of (1) a , (2) failure at the descending line of resistance or (3) a new ATH . Notwithstanding myriad global economic problems, including corporate , I’m inclined to think we will see a new ATH as we recently saw with SPY .
This view is reinforced by the A,B,C (1,2,3 whatever) pattern off of the lows off the lows of 2009 to the high of 2135 in May, 2015.
While most agree it was a three point move on a monthly basis, there is disagreement as to the location of the second point. My placement would suggest 2150 is not out of the question and would form a new head around which we would likely see descending shoulders form leading to the next wave down.
My short term outlook is supported by many indicators dealing with the internals of the market, including the % of stocks trading above their 200DMA which presently is around 79%. This average could edge up to around 90% before we could see an “event”.
Short term I’m a bull, longer term I’m a bear because of the economy.