Craig Johnson of Piper Jaffray has some bad news for the bears. In the attached clip the technical analyst says the S&P 500 (^GSPC) is going to hit his long-time target of 2,000 and it's going to happen sooner than most people think.
Johnson is well aware of the fact that a lot of the "smart money" is going to take the other side of his call. Five years into the bull markets it's become quite trendy to sneer at the market. Whether it's a snarky desire to bet against the masses or an excuse for having not participated in a 52-week rally in excess of more than 30%, more and more institutional investors are loudly jumping out of equities.
Unfortunately those jumping out of equities don't have anywhere to go. That lack of alternatives has been pushing stocks higher for years and the wind is only picking up. "You need to own equities if you're going to continue to be a long-term investor," Johnson offers. Bonds look dicey but yields offer little reward, gold demand is at a 4 year low, the SPDR Gold Shares ETF (GLD) is locked in a bear market, and those sitting in cash looking for a pullback have been stuck on the sidelines for more than two and a half years.
Perhaps best of all, the mood towards equities is grudging respect at best. Money is flowing in but no one anywhere is pounding the table on valuation. The bullish case is based on a slow-growth economy and lack of alternatives. That's going to be more than enough to bring Santa to town.
Johnson's got a year end target of 1,850 for the S&P. "We got another 60 points to go and let me tell you, from a sentiment perspective people don't believe."