The stock market's strong start to 2024 is signaling 13% more upside over then next year, research firm says
"This strength off of the late October lows is actually consistent with the beginning of longer-term market strength, not the end of bull markets."
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- The stock market has more room to run after a strong start to the year, according to Carson Group.
- The firm highlighted two stock market signals that suggest 13% upside over the next year.
- "This strength off of the late October lows is actually consistent with the beginning of longer-term market strength, not the end of bull markets," Detrick said.
The stock market has more room to run after a strong start to the year, according to Carson Group equity strategist Ryan Detrick.
That bullish thinking runs counter to the bearish concerns that the stock market is in a bubble, but Detrick said history is on his side.
Detrick highlighted two stock market signals that recently flashed, and historically, these signals have delivered an average gain of 13% over the next twelve months, suggesting that the current bull market is not nearing its end.
The first signal is the S&P 500 rising more than 20% over the past 20 weeks. The S&P 500 is up 24% over the past 20 weeks, representing one of the best 20-week rallies in the S&P 500's history.
Using data since 1950, Detrick observed 22 other times the S&P 500 gained more than 20% in 20 weeks. The average one-year return after the signal flashed was 13%, with an extremely high win ratio of 96%.
Carson Group
The second bullish stock market signal highlighted by Detrick is the S&P 500 rising 8% year-to-date as of the 50th trading day of the year.
"We found 25 other times stocks were up at least 5% on day 50 and the rest of the year was up an incredible 24 times and up 12.6% on average the rest of the year versus the average return of 7.6%," Detrick explained.
These signals suggest to Detrick that the bull market rally in stocks is probably closer to its beginning than it is to its end.
"This strength off of the late October lows is actually consistent with the beginning of longer-term market strength, not the end of bull markets," Detrick said.