Thursday, May 31, 2007

Thoughts for Thursday, May 31

I have been meaning to look up an old report that I wrote in October 2002, and finally found it tonight. The image below is one chart from that report. It is based on a quarterly line chart that I was using for very long-term analysis. The projection I made was for a low of around 750 at some point in 2003. The S&P 500 wound up reaching a low of 788 in March of 2003.


More importantly, I was speculating what would happen after we made a new low. The results of my analysis raised a few eyebrows at the time, and was actually quite a big deal for me because it represents a departure from Robert Prechter's long-term view. Now that the S&P 500 is rallying to new highs, I thought it would be a good time to revisit this report.


If you take a closer look at the last paragraph on the chart, you can see that I suggested that the S&P 500 would rally approximately 1468.35 points to a high of around 2218.35. I expected this top to be made in 2010. We have now officially rallied over half-way to that projected target since the March 2003 low. It will be interesting to see where the S&P 500 winds up in three years.

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