This Year's Powerful Start Could Lead to More Gains in U.S. Stocks By Chris Igou, analyst, True Wealth
The S&P 500 Index locked in a 14% gain in the first half of 2021... That kind of kick start to a year is rare. We've only seen similar rallies 13 other times in more than 70 years. Don't bet on a slowdown, though. History shows that this kind of surge isn't likely to run out of steam... We could see even more gains to finish off 2021. Another double-digit rally is possible in the next six months. Let me explain... Bull markets don't die of old age. That's important to remember when we're in the thick of a rally like today's. Yes, the S&P 500 has been on a one-way trip higher since bottoming in March 2020. But that doesn't mean the Melt Up has to end tomorrow. That's why we always want to turn to the numbers to make our investment decisions. And today, history shows us the current rally likely has more room to run. For example, similarly impressive first-half rallies led to more gains 69% of the time since 1950. Again, the S&P 500 rallied 14% in the first six months of 2021. Take a look... We've seen a strong surge in U.S. stocks so far this year. And history shows us that the rally can continue... Since 1950, we've seen 13 other first-half rallies of the same magnitude or more. And those typically led to even higher highs in the following six months. Take a look... More than 70 years of market data shows us that today's impressive move is a good thing. Nine of the other 13 examples turned into winning trades. And five of them rallied 10% or more to finish the year. Simply put, you shouldn't be worried about stocks after a fantastic first half... You should be bullish. Yes, the Melt Down will rear its ugly head at some point. This bull market, like every other, won't last forever. But don't confuse inevitable with imminent. Today's bull market isn't out of steam just yet. A strong move to finish the year is possible – even likely – based on history. And you want to be along for the ride as long as the uptrend is in your favor. That's what we're seeing today. So right now, make sure you stay long. Good investing, Chris Igou | | | | Further Reading "Folks often think of a breakout as a sign to be cautious," Chris writes. It's easy to think you've missed your chance when a market is soaring. And right now, European stocks are breaking out. But history tells us that it could be the start of another move higher... Read more here: It's Time to Buy European Stocks. "Big gains tend to squash investor fears and send folks chasing after more profits," Chris says. But for this specific group of stocks, that isn't happening. Instead, investors have been running from them in droves. And that gives us a major opportunity today... Get the full story here: Investor Fear Will Likely Send This Market Even Higher. | | | | | INSIDE TODAY'S
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