Market Fails to Dismiss Double Top Scenario

About a month ago I mentioned that it was possible the market could find resistance near the old highs on the S&P 500 index and perhaps make a seven-year double top. Interestingly, yesterday marked the third straight day the market could not register a new closing high on the S&P 500 (1,527 and change).

I’m not really into short-term market predictions (You’re better off just flipping a coin if you want to know what will happen in coming days), but we are setting up for a near-term top unless we can break through this level. Oddly, the all-time intra-day high is above 1,550. That must have been a wild day back in March 2000.

Here is what the last decade looks like on the SPX:

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5 Thoughts on “Market Fails to Dismiss Double Top Scenario

  1. I am a bit wary of the S&P’s inability to push passed its all-time high here but I guess it is about time for us to see a little resistance to what has been a pretty nice little run for the Dow and S&P. That being said, given that we’re looking at a period of 7 years isn’t it a bit early to say the market is at all stalling at this level?

  2. Chad Brand on May 25, 2007 at 5:19 AM said:

    Hi Dan,

    I’m not making a prediction that it will definitely fail to break through here, just pointing out the possibility. It has definitely stalled, but whether four days is enough of a stalling out period to say the rally is done or not remains to be seen.

  3. Anonymous on May 25, 2007 at 10:37 AM said:

    If Greenspan had said nothing about China’s markets we might have broken through.

  4. Chisoccer on May 25, 2007 at 10:50 AM said:

    The point of long term analysis is excellent. It might be a double, it might not. How many people look back more than a couple of years?

    Nice job

    I love the site. I started one ( and would love to converse on site development and the topic of investment.

  5. Chad Brand on May 31, 2007 at 6:21 AM said:

    thanks for the kind words. if you ever want to discuss your site and related topics, just let me know.

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