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Why S&P 2,000 could just be the beginning

Why S&P 2,000 could just be the beginning

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Why S&P 2,000 could just be the beginning

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Could the path of least resistance be up?

The S&P 500 broke above 2,000 for the first time Monday, and according to one highly regarded technician, the easiest trade might just be the trade that’s been working all year.

“We think the market is going higher,” said Ari Wald, Oppenheimer’s head of technical analysis. “We were buyers in early August and we are still buyers.”

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The chart shows that there is still more room to run in the market.

The chart shows that there is still more room to run in the market.

Wald looked at a chart of the SPDR S&P 500, or the SPY, which is the ETF that tracks the performance of the S&P. “It’s been above its 100-day moving average all year, it’s been making higher highs and higher lows, and it’s been stair stepping higher. The question is,” he added, “does it continue to move higher? All the indicators say yes.”

One indicator Wald is looking at closely is the relative ratio between high-beta and low-volatility stocks, which is a gauge of investor risk appetite. According to Wald, it’s signaling a buy sign. “The fact that we saw a new high by this ratio confirmed that investors still want to take risks. This is healthy. We think it suggests this market is going higher.”

(Read more: Why S&P 2,000 milestone has Art Cashin unimpressed)

Jason Rotman of Lido Isle Advisors agreed that the S&P will continue to trend higher through the rest of the year.

“I’m going to put on my technical cap for a second and tell you that my year-end target is 2,050,” he joked. “Fundamentally, 486 companies have reported earnings. There was a 10 percent year-over-year growth rate in earnings. That’s the highest number since fourth quarter of 2011.”

(Read more: The best & worst of the S&P 500 since 1K)

Another factor in the market’s record run, low interest rates, “Fed Chair Janet Yellen said labor markets still have further to heal before their economies can weather higher interest rates. That means more bullish forces for the market.”

And according to Rotman, the combination of solid earnings with low interest rates is a “recipe for the bulls to stay in control.”

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