We Could Be In for a Significant Rally: Clem Chambers

Stock markets in the US and Europe are likely to see a significant rally if indexes manage to rise further from current levels, technical analyst Clem Chambers, CEO of ADVFN, told CNBC Monday.

"We're very much in break-up territory here. If we break out for a few days here, we could be in for a significant rally," Chambers said. "It's looking very strong, it's feeling very strong."

European stocks charged ahead Monday, after news that US lender CIT Group struck a deal with creditors to avoid bankruptcy. The main European indexes were up between 1.5 percent and 2 percent.

"I was expecting there might be a little bit of correction today, since we had such a good week, but it looks like we're going to power on from here," Chambers said.

He said Asian markets, which rallied Monday with the Hang Seng surging 3.7 percent, looked overextended, but Europe and America "could go up a fair way."