The pieces are in place for the Standard & Poor’s 500 Index to hit 1,650 by year-end, says Ryan Detrick, senior technical strategist at Schaeffer's Investment Research.
That would represent a 12 percent gain from Wednesday’s close of 1,473.
One bullish signal is the strength of small cap stocks, which have outperformed large caps by more than 100 percent over the last 10 years, Detrick tells Yahoo.
Editor's Note: See the Disturbing Charts: 50% Unemployment, 90% Stock Market Crash, 100% Inflation
The Russell 2000 index of small cap stocks hit a record high of 884.84 Tuesday.
"That's an indicator that potentially sometime later this year, blue chips very well might also break out to new highs,” Detrick says. “The small cap leadership is a good sign."
Gains by mid-cap stocks also are a promising development, he says. The ability of the S&P 400 Mid-cap Index to stay above 1,000 since early December is important, he says.
While stocks may be “a little overextended” for now, "the upward trend continues to be in place," Detrick says.
Some investors don’t share his confidence.
"I'm not an optimist or a pessimist at this point. I'm trying to figure out best how to navigate this," Kim Caughey Forrest, senior equity strategist at Fort Pitt Capital Group, tells The Wall Street Journal.
“I don't feel the love. People are putting money to work, as opposed to seeing great opportunities and finding money to put there."
Editor's Note: See the Disturbing Charts: 50% Unemployment, 90% Stock Market Crash, 100% Inflation
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