August 20, 2012     In my recent articles I presented evidence in support of a possible major bull market which may have commenced in 2009. Here I show that another indicator, this time based on a statistical analysis of the historic data of the S&P, signals the same. But how high will the S&P go?

Nobody knows, and the best we can do is to use the historic data (which is from Shiller’s S&P series) to provide us with an estimate. From the real price of the S&P with dividends re-invested (S&P-real) one finds that the best fit line from January 1871 to July 2012 fits the data rather well when both are plotted on a semi-log scale. There is no reason to believe that this long-term trend of S&P-real will not continue into the future. S&P-real and the best fit line together with its prediction band is shown in figure 1.