Chartology: What's Next For Stocks?

Is the market getting ready for a big move higher or are we going to tank, again? Find out what the charts suggest!

We couldn’t think of anyone better to ask then Oppenheimer chief market strategist Carter Worth. (As you might know, he was among the first people to call a bottom in this bear market.)

After considering our question for a moment he tells us to first take a look at this chart of the S&P.

"You see a great collapse over the past year and a half and then the tight range that’s we’ve been in since October," he explains.

Yes, that's pretty easy to see. And there’s a widely held belief that stocks are going to have a big directional move, we reply.

But Worth scoffs.

He tells us, “if you look at the range itself from the lows of October to the highs, it’s about a 30% range. And if you go back and look at equity markets as far back as the turn of the century the average range for an equity market in any given year is 30%.”

In other words, Worth believes we stay in this sideways range for a while.

But that doesn’t mean you can’t trade it. Just go into your trades looking for 30% moves in either direction.

In fact, Worth thinks there’s two ways to go.

1) Find beaten down stocks that have short-term upside potential such as industrial material and energy names.

2) Check out healthcare and biotech stocks. They’re the least likely to be dragged down by the weak economy.

To see our complete interview with Carter Worth please watch the video.

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