On April 2nd I showed a chart of the SP500 when it was trading at 1332 showing resistance at 1370. The updated chart below now shows it is within spitting distance of that resistance at 1363. I think there is no doubt that 1370 with be hit, probably on Monday. The only question is whether the market pulls back from below, pulls back from above, or just blasts through without pulling back. No matter which way it happens I think it is inevitable that 1370 is surpassed and once it is, there is no reason that a new all time high will not be next, even if it takes a little while.
Almost exactly a year ago the bears had a chance to take down this market with the flash crash event. That possibility remained on the table until the end of 2010 as a double top potential still existed. However, 2011 ushered in a move through the last truly viable zone of resistance at 1257 which was retested in March of this year. While there are still many people pushing the bearish case, for all intents and purposes the bearish case was toast after the March reversal.
I gave one last shot at shorting the market in February and March. When that failed there was nothing to do but get long and stay long, which has been a winning strategy since then. I suppose there might be a chance for a summer correction, but the fact is that once the SP500 pushes through 1370 there is nothing to hold it back from a new all time high.
There is more to analyzing the market than counting waves. We have to respect the fact that there is no such thing as a triple top (by this we mean that the market will not break down below the previous low - not that it cannot decline from a triple top), and this will be the 3rd time the SP500 makes it to the 1550 to 1560 zone. WD Gann pointed out a very long time ago that any market that pushes to a level for the 4th time is almost guaranteed to break through. This is what I will be looking for sometime later this year or early next year.
I still think that this may be an x or b wave of cycle degree, but we just don't know what the overall pattern will ultimately be at supercycle degree. I still think it may be end up being some sort of flat combination or running triangle. However, that is a long way out, and for now the trend is up until proven otherwise.