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Where's the S&P Headed From Here? Higher!

BALTIMORE (Stockpickr) -- To someone who just started investing in the last year, 2014 has been a bloodbath. In the first month of the year, the S&P 500 shed 3.56%. If stocks continued to sell off at this rate for the rest of the year, it'd make 2008 look like a cakewalk.

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But that doesn't mean that it's time to pull your cash out of the market and invest it in a backyard bunker. As we enter February's first trading session, stocks still look very attractive.

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Yes, I realize that sounds hard to swallow. If stocks are on track to one-up 2008's selloff, how can it still look like a good time to buy them? But as I'll show you, nearly every data point that supports an end to the upward trend in stocks is horribly skewed.

So as things stand now, February looks like the month to hit the "buy" button again. We're still in a "buy the dips" market.

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As investors, we have short memories. For instance, as soon as the calendar flipped over to 2014, we suddenly forgot that corrections aren't unprecedented for this market. Even though the market gave us eerily similar corrections in October, and in August, again in June, another time in March, and yet again back in January of last year, somehow this latest correction is jarring.

Even though the other recent corrections were larger in size and duration than this one, our January correction has somehow been scary.

And even though this correction was extremely predictable, it caught us off guard.

But you didn't have to be some kind of stock market sage to figure out that stocks were about to correct. The S&P 500 has been trading in an extremely well-defined price channel all the way up (you can see it here), and it finally hit its head on resistance in January. That means that we were either about to correct, or this time it was suddenly going to be different for some reason.

Likewise, as the S&P gets closer to the bottom of its trend channel, we've got to ask ourselves whether we're coming up on another textbook buying opportunity for stocks, or whether "This time, it's different."

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