The Bull Is Living on Borrowed Time

 

If stock prices continue to rise, as they have for the last couple of weeks, then some time within the next month or so this bull market will become the longest since World War II.

That’s right: This most unloved of all bulls may last longer than the 1990s stock bubble, which went from irrational exuberance to dotcom euphoria before crashing back down to earth.

Before Thursday’s modest sell-off, the S&P 500 index was less than 60 points below its all-time closing high of 2872.87, set January 26th. The Dow Jones Industrial Average was a more sizable 1,400 points from its late January peak. The Nasdaq Composite index actually hit its all-time high on Tuesday. All three major indices have bounced back nicely from their double-bottom lows in early February and early April.

We at GoldenEgg Investing® always thought the late January-early February sell-off was a correction, not the beginning of a new bear. The fundamentals—economic growth and earnings—are just too good to be derailed  by anything less than a recession, full-blown trade war or actual war, all of which are possible, but not likely just yet.

But if the market manages to top its late January all-time high and keeps moving higher, it will face a couple of big barriers to further advancement.

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