Why a sideways stock market could indicate the highs are yet to come

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Why a sideways stock market could indicate the highs are yet to come
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Why a stock-market top would be 'very unusual' right now:

Bears contend the stock market’s largely sideways action over the last year signals a top may already be near, if not already established. But that would be out of keeping with recent history, says one economist.

As the table shows, the stock market’s peak has come ahead of the economy in the run-up to seven of the last eight recessions dating back to 1960, LaVorgna noted, with an average lead of seven months. More recently, there have been much shorter lead times from the stock-market peak to the peak in the economy, he said, which “means that strong stock-market performance could persist until very late in the business cycle.

The market’s largely sideways trade over the last 12 months — the S&P 500 SPX, -0.01% has gained 2.1% over the past year, while the Dow Jones Industrial Average DJIA, +0.06% is up 0.8% over the same stretch — “suggests that we have not seen the highs of the current business cycle,” LaVorgna said.

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