The S & P 500 is flashing a “rare signal” that suggests the market rally has some legs, Bank of America says. On Monday, the S & P 500 closed at a new 52-week high for the first time in 525 calendar days, a milestone that supports the bull case for equities, according to technical strategist Stephen Suttmeier. He noted it’s only the 25th time the broader index notched a new 52-week high after a long pause of 300 or more calendar days between 52-week highs. What’s more, it’s the first time since right after the Brexit vote in the U.K. in 2016 that the long-pause indicator flashed, the strategist said. “It’s a rare signal,” Suttmeier said. “And what it does suggest is that the S & P should have stronger-than-average returns going out from 10 days to a year, and even two years later.” In fact, the strategist expects the S & P 500 to rise somewhere between 4,900 and 5,000 by next summer should the signal bear out as it has historically. Of the previous 24 signals, the S & P 500 notched a double-digit gain 16 times. “I do think it’s meaningful,” Suttmeier said. “And the reason why it’s meaningful is because there’s such a long distance of time between new 52-week highs, because prior to yesterday, the last 52-week high on the S & P was early January 2022.” For Suttmeier, it’s just the latest bullish indicator showing the market environment is better than the prevailing economic narrative might suggest, including rising 40-week and 200-week moving averages, he said. “The pattern now resembles what we saw in 2012, 2016, 2019 and 2020, where there’s a lot of fear out there in the marketplace, a lot of concerns, some legitimate, obviously,” Suttmeier said. “But it’s similar to those ‘wall of worry’ periods that we have seen in the past.” Oppenheimer’s Ari Wald was similarly encouraged by Monday’s action, saying the broadening participation — particularly among small caps — supports his bullish year-end outlook. Wald forecasts the S & P 500 will overshoot to 4,600 before landing around 4,400 by the end of 2023, saying the index will rebound from what he expects was a bear market low in October. “I think the broadening of participation should support additional market upside, and understanding that won’t be a straight line higher, but we are continuing to play by bull market rules and expect higher lows to be followed by higher highs for now,” Wald said. Not everybody held such a positive view on markets, saying troubling signals remain eight months out from the October low, despite the continued resilience in equities. Notably, BTIG’s Jonathan Krinsky pointed to the continued weakness in market participation and credit markets. For example, while the S & P 500 has notched a new 52-week high, only a small percentage of the index has managed the same milestone, which suggests narrow leadership. “We are still of the view that the S & P should move lower, and kind of catch down to what breadth has been saying for a while,” he said.