Market's longest win streak since 1995 will likely end badly, Art Hogan warns

The Dow is seeing its longest weekly win streak in almost 24 years.

It's tracking to see its ninth positive week in a row.

But according to National Securities' Art Hogan the win streak could go badly at anytime.

"We're probably going to have a bit of a consolidation period in front of us," he said Wednesday on CNBC's "Trading Nation" — pointing to the sheer magnitude of gains in a short time span.

When the Dow's 10-week win streak ended on May 12, 1995, it fell 2 percent the following week. Ultimately, the blue chip index was flat over the next month.

This time around, Hogan predicts a more volatile outcome.

"If you look back to the December low and the 18 percent pop we've had since then, ... it makes sense to have a week or two of consolidation," he said.

Hogan, who has a 2,850 year-end target on the S&P 500, wouldn't advise going to cash if a sell-off strikes.

If his consolidation forecast takes shape, he recommends putting money to work in health care, industrials and technology — excluding social media names due to potential regulatory headwinds. He lists attractive valuations and growth potential as reasons to consider buying them.

"Even if we trace half of the move since Dec. 26, it gets you down 8 or 9 percent," Hogan said. "That would be a significant place to be thinking about getting more involved in some of those sectors."

In just the first eight weeks of this year, the Dow and S&P 500 have rallied by 11 percent.


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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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