Author: Mark Holder, Stone Fox Capital
Widely followed technical analyst Carter Worth of Oppenheimer was on Fast Money last night (8/1). He has consistently for awhile now been bullish on a breakout of the market once the current range is broken.
The major reason is that the market spent 7 months in this range back in 2008 before finally breaking down. Now the market has spent nearly 7 months in the same range and the normal outcome would be the opposite of the last time it spent time in this range. Logically it makes sense that numerous funds are exiting positions that they have held for the last 3 years. Once they are done and the market breaks out or down the move will likely be strong.