It is April Fools’ Day today and also the first trading day of Q2, which since 1990 has on average been the most bullish day of the most bullish month of the year. It seems very possible that the current all time high on SPX will be tested today and obviously this is an auspicious day for the bulls to be doing that.
It has been an impressive five full quarters now without a test of either the weekly lower bollinger band or the daily 200 DMA, and if that could be extended into the end of 2014 then the two full calendar years without hitting either would be only the second time in history that this has been achieved. I’ll be taking a look at the historic charts to see what happened after the only other time this was managed in 1927/8, but it could well be that stock prices might then have achieved a permanent high plateau from which any significant decline would have become unthinkable. Heady times indeed. (more…)