S&P 500 historical PE ratio chart

- PE 26-27 is considered to be a strong sell

- but S&P 500 PE once reached 40 and later it hit 65

- both were abberations

- the first time was during the dot com rally and subsequent crash

- the next time was during the 2008 financial crisis when EPS dropped extremely fast but prices did not correct with same speed thus leading to an inflated PE