What chance the Dow Jones takes out its all time high in the next few months?

Since hitting a high of 14087 on 1 October 2007 the bellwether US index fell to a trough of 6500 in the aftermath of the Lehman crisis in early March 2009 and has now doubled in value in just over 3 years – a salutary reminder for those current sellers of Spanish equities that the depths of despair are almost without fail the best possible times to buy assets.

Below is a chart of the DJI over the past 10 years and it looks to me like we are about to probe the old record high, particularly as the sentiment backdrop is not one of rampant bullishness but almost a jaded perception of equities as an asset class – ideal fertile ground for the bull market to continue to grow.

The montly chart below shows no sign whatosever of weakness and I’d urge our readers to listen to our resident Technical Analyst Dominic Picarda’s webcast this month (link here – http://www.spreadbetmagazine.com/webcasts/) to understand just how strong the internals of the market currently are.

Also, with the forthcoming election later this year, US equities more often than not perform well in the months leading upto the election. Perhaps this year, contrary to speculation that we are looking at a re-run of 2011, “sell in May and go away” is not to be heeded.