Breaking Out Of A Tight Range Is Historically Bullish
The following chart from Strategas Research Partners highlights prior trading range breakouts for the S&P500. The last two years saw the S&P500 trade within one of the narrowest ranges on record and historically once the tight trading range is broken it’s bullish for stocks.
Since 1953 when the S&P500 breaks out of a two year trading range, which was less than 20%, the index saw above average forward returns, see below:
