So let's say we get the blow-off top into year's end. What if we pull back early this week, into Wednesday's FOMC, and the Fed comes out and promises to do whatever it takes to support the market with ample liquidity through the annoying speed bump of the fiscal cliff. Maybe Ben even throws in a word of advice for removing the debt ceiling altogether.
There are upper bearish wedge trendlines right at SPX 1500 at the end of 2012. What if we rally furiously into EOY and actually top there?
I went back and took the big picture SPX chart, added a blow-off rally like this, and then pasted the entire 2007-2009 cycle right on top of it, starting at 1500 on January 1.
Yeah, I know history doesn't repeat ... but this chart ... just take a look.