Stocks are going higher

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Stocks are going higher.

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Probably.

According to J.C. O'Hara, chief market technician at FBN Securities, on Wednesday the S&P 500 broke a long-running streak that history says indicates a new uptrend in the market is near.

On Wednesday the benchmark stock index broke a 396-day trend of trading below its Upper Bollinger Band, a technical indicator that measures the volatility of the market around a smoothed price.

Bollinger Bands basically wrap the moving average of an index's price. And moves by this index above or below these bands can indicate the reversal or break of a trend in the market.

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It looks like this:

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And O'Hara finds that moves back above the upper band - indicating a rise in stocks faster than recent trends - after a long period of staying below this level means a reversal in the market's overall trend could be near.

Here's O'Hara:

We consulted the charts and found the majority of the time when the S&P 500 traded for an extended period of time without testing its Upper Volatility Band, the market had a Bear or Sideways Trend. Bull Markets have a tendency to test the Upper Volatility Band often. What we find very interesting is how the market responds to the first close above the Upper Bollinger Band after an extended period of time below (we use 6 months as extended). The data concludes this positive volatility in price movement is an early signal that the preceding Bear/Trendless market is concluding and a new Bull/Uptrend market is near.

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Additionally, O'Hara finds that when stocks break back above their upper Bollinger Band after at least six months below this level, the historical return for stocks over the next year is 7.6% with the median return coming in at 14.2% over this period.

There is a 73.3% chance that stocks will be up over the next year after this event.

For the last 18 months or so stocks have been basically moving sideways and been overall directionless. Some analysts would argue we're seeing a pause in a still-going bull market while others would argue we're in the beginning of a downtrend. Price action, though, has sent markets nowhere.

And at least looking at this technical measure, that could be ending soon... with stocks going up.

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