The S&P 500 hit fresh all-time highs last week, confirming the buy-the-dip trade remains alive and well.
“2021 has been one of the most consistent and persistent rallies ever,” notes Sundial Capital Research. Not only is the S&P 500 up 18 per cent, it’s gone nine months without being over 5 per cent from its highs.
The smallest of dips is pounced upon. The recovery time from big one-day drops in 2021 has been just 2.6 days, according to Bank of America – the shortest on record.
Investors are betting new highs are never far away. And why wouldn’t they? Stocks have already hit 44 new highs this year – the third-quickest year to record so many all-time highs, says Sundial, behind only 1964 and 1995.
Other markets has been similarly bullish. Sundial notes every major developed market has had a rising 200-day moving average for 150 consecutive trading days – the fifth-longest streak in the last 50 years.
