S&P 1300 Is More Important For Markets Than Dow 12,000: Pros

While the Dow crossed the big round 12,000 mark, many market pros see the 1300 level on the S&P 500 as a much more important measure.

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"It's a critical area,"said Art Cashin, director of floor operations at UBS. "There's supposed to a lot of resistance between 1298 and 1302....If they go above that, they would be preparing for another leg up."

Carter Worth, chief market technician, at Oppenheimer Asset Management, said the next big number he's watching is 1310 on the S&P . He said it is right to focus on the Dow 12,000 milestone, but it doesn't really say that much about the market. "It's maybe something that's a headline but it doesn't mean a whole lot" he said.

"The next important reference is (S&P) 1310. That's where more supply comes into play," he said. Worth expects the market to make it through the 1310 level this year, and his year end target is 1400.

Earlier this week, he pointed to the movement into "super-cap laggards," noting that implies the market remains healthy and the chance of an "'imminent swoon' is low."

"So important, in fact, is the rotation that we would argue that the 'stretched' look and feel of the S&P 500 is 'resolved' not by a sharp sell off but rather by a normal enough period of resting/consolidating," he wrote. He said if there is a dip it would be more like the 4.5 percent sell off in November, rather than a sharper move.

Even as the market continues to tick higher, some analysts expect to see a correction in the not too distant future.

"We have a 1350 target on the S&P for year end, so I suggest we would say if we cross 1300 here, it probably wouldn't be for the last time this year. Maybe we overshoot in the near term, but I still think we get a pretty substantial correction," said Andrew Burkly, director of equity strategy research at Brown Brothers Harriman.

Burkly said an area he's watching on the S&P is 1311, the August, 2008 peak just before Lehman failed and the financial crisis hit hard. The S&P first crossed 1300 on March 15, 1999. It last closed above 1300 on Aug. 28, 2008.

But as for Dow 12,000 and S&P 1300, he thinks they're just levels that attract attention. "It's a nice round number psychologically. It plays to retail investors a little bit more," he said.

Burkly said the bullish forecasts this earnings season have been a boost to the market but he expects to see margin pressure come into play later in the year. "The forward numbers are looking very strong. For the first time we've gotten to (S&P EPS) $97 for 2011," he said, noting his forecast remains below that level at $95. $97 would be record profits for the S&P 500.

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