The woman who predicted the 1987 stock market crash says now is the best time to buy stocks that she has seen in decades.
"My thirteen stock market indicators are at a bullish level—they are at 71 percent. Anything above 65 percent is bullish, 30 percent would be a sell signal or a major bear market—before the crash of '87 the indicators got down to 9 percent," Elaine Garzarelli, president of Garzarelli Capital, told CNBC's "The Strategy Session" on Thursday.
Garzarelli cites what happened with Japan's Nikkei 225 Index as one reason to be so bullish right now on the equity market here in the United States.
"In Japan, after they implemented QE1 [quantitative easing], and they did it with aggression, the stock market [Nikkei] went up 50 percent. The second time they did it with aggression, like we're [U.S.] doing it, the stock market went up 80 percent. When they stopped QE, the stock market went down 50 percent," she said.
"QE does help the stock market, doesn't always help the economy," she said.
"If this is not working, we'll be able to see it pretty easily in the statistics that come out and that would change our mind," Garzarelli said, adding, "So if QE2 does not work and we go into a recession with earnings down 30 percent, my indicators would drop to 20 percent and I'd change my mind."
"At this point things look pretty good. And the statistics that are coming out in the last two weeks have been very favorable, right down the line," she said.
Heading in 2011, Garzarelli is recommending four ETFs (exchange-traded funds):
+ Consumer Discret Select Sector SPDR (XLY)
+ Industrial Select Sector SPDR (XLI)
+ Materials Select Sector SPDR (XLB)
+ Technology Select Sector SPDR (XLK)
Originally televised on CNBC and published on CNBC.com.