This chart is 'worth a thousand words' and signals a bigger market breakout ahead 

It's a new chart that presents a raging bull case for stocks.

Raymond James' Jeffrey Saut says the S&P 500 just made a key move: The index broke out from a multimonth base. And, he believes it doesn't get much bullish than that.

"You've basically been in an upside consolidation," the firm's chief investment strategist said Wednesday on CNBC's "Trading Nation."

According to the Wall Street veteran and long-time bull, it's a chart "worth a thousand words."

"That upside consolidation phase tells me that we're going to be above 3,000 probably by Thanksgiving and probably 3,100 to 3,200 by the end of the year," Saut said.

It's unusual for Saut to issue price targets. But, he's so confident stocks are heading even higher, he's making an exception.

"My father was a portfolio manager, and he told me if you get it directionally correct, you're ahead of the crowd. So, don't give people targets," Saut said. "But earnings continue to come in better than expected. Valuations are not that high."

Saut's latest read on stocks came as the S&P 500 reached a fresh all-time high and closed above 2,900 for the first time. It's now about 13 percent higher since the Feb. 9 correction low. The Nasdaq also reached a record high.

In this environment, he likes all industries except utilities and consumer staples, which he deems as too expensive based on valuations. Right now, he's highlighting financials as a group that could grab substantial gains.

"They are in a secular bull market, and they remain undervalued here because too many people are looking at the yield curve," Saut said. "We continue to think that earnings [will] come in better than expected, and people are still fearful."

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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's Closing Bell (M-F, 3PM-5PM ET). In addition, he contributes to CNBC and CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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