R.I.P. Bull Market, 1982-2008

So, you might ask, when this benchmark index rallies over the next six months, where might those levels be to get out of those longs you wished you had sold months ago? I believe you need to look at this same model on a weekly basis, taking one step forward in time. It shows the current weekly cloud with a range of 1366 to 1416.

Weekly S&P 500 Cash Index

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Source: CQG

I don't believe that will help us much this week, given a close Friday of 877. But as time goes on, heading out as much as six months, we can see that by late April 2009, the cloud's value drops to about 1100 to 1200. Should time and price line up, the index will likely have trouble hurdling that zone, and thus investors should consider unloading a decent amount of equity.

Lastly, using the same model on a mega-long-term quarterly chart basis, a close on Dec. 31 of this year under SPX 923 suggest that the best-case scenario for all of 2009 is a move back up to 1116 (on a closing quarterly basis) and even a tad lower for all of 2010.