The Australia 200 index this week broke out to hit new post-GFC highs. On Tuesday it traded above 6,000 for the first time on volumes around 133% above average. The index has gained further ground over the following sessions, once again on higher volumes. This volume confirmation means that the break is significant, and points to further gains for shares. T

The chart above speaks to the significance of the move, and suggests the next major upside target for the index is the all-time high at 6,852.

The backdrop to the break out is record levels for share markets around the globe. However there are two important local factors. One is the lift in the Materials and Energy sectors in response to surging industrial commodity prices. The other is a re-rating of CBA following its quarterly report on Wednesday, and the halo effect this is bestowing on the financial sector.

For traders the index is now in new territory, with the potential to describe a new, higher trading range or a possible up trend. For investors who are underweight shares and/or overweight cash there are risks of underperformance. Given higher reported levels of cash among both institutional and SMSF investors this could be a common problem.

Forget the Santa Claus rally, the next major up move for Australian shares may be driven by FOMO – fear of missing out.