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A stock market breakout to new highs is officially underway, Wall Street bull Jeff Saut says

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A stock market breakout to new highs is underway, Jeff Saut says

The wait may be over for a sustainable market bounce.

According to Capital Wealth Planning's Jeffrey Saut, the breakout is officially here due to a major breakthrough.

"You came down into a selling climax on August 5, and we deem that to be the low," the firm's chief investment strategist told CNBC's "Trading Nation" on Wednesday. "We've been in this trading range between August 5 and last week, and we broke out to the upside last week."

The S&P 500 closed above 3,000 on Wednesday for the first time since late July. It's now a fraction of a percent from record highs. Thursday's futures prices were pointing higher after President Donald Trump and China offered conciliatory moves in their trade war.

Saut, who has $1.5 billion in assets under management, contends the fear dynamic over the impact of the U.S.-China trade war, inverted Treasury yield curve and global growth fears are dissipating for good.

"Our work suggests where interest rates are right now that a fair market multiple on the S&P is 19 times earnings.," he said. "You're still looking at above 3,100 on the S&P by year-end."

Known for his basket of proprietary indicators, Saut has been tracking the markets for almost a half century. He's been adamant — even during pullbacks — that the current bull market has years left.

"I've never wavered since October of 2008," Saut said. "We're in a secular bull market."

As for the best plays to capitalize off the market's next leg higher, Saut lists consumer cyclicals, energy and particularly financials as S&P groups for investors to consider.

"Financials came on strong yesterday, and they're cheap stocks," Saut said in Wednesday's interview. "Good things tend to happen to cheap stocks."

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Wall Street bull Jeff Saut suggests a market breakout is officially here