The Japanese stock market is in the middle of an incredible rally.

Few investors have been paying attention. They've been distracted by ups and downs in the U.S. market. We've had regional-bank failures, a debt-ceiling crisis, and now a massive stock rally.

Meanwhile, Japanese stocks have hit a 33-year high. The last time this market saw prices like these was in 1990... at the tail end of an economic bubble.

This boom can continue, too. That's because the recent new high tells us that the trend is in our favor... and that more gains are on the way.

Let me explain...

You don't usually see a global market hit a new multidecade high. That's because most markets have an upward bias... So it's uncommon for them to stay below the high of three decades ago, unable to break out for so long.

But it happened in Japan. That's because the bubble it experienced in the 1980s was so intense. Consider this...

In 1980, Japanese stocks made up just 15% of the global market. By 1989, that percentage had soared to roughly 45%. And by 1990, Japan's real estate was five times more valuable than all of the U.S.'s real estate... even though total acreage stateside dwarfed Japan's 25 times over.

It was a crazy time. Japanese stocks have been underwater ever since. But that's changing now.

Japanese stocks have been rallying. Again, they just hit a 33-year high. Take a look...

This market has marched higher since the bottom of the global financial crisis. And the recent surge pushed it above 2020 highs... to levels not seen since 1990.

You'll almost never see a breakout this big. So to find out what could happen next, I looked at each time Japanese stocks made a new 52-week high since 1970.

Even that kind of move is rare. It has happened just 30 other times in more than half a century. And it has consistently led to outperformance. Take a look...

Japanese stocks have gone through an incredible bubble, followed by one of the worst busts in history. And overall, the market has risen about 5% per year since 1970. You can do better if you follow the trend, though...

Buying after new 52-week highs has led to 4.2% gains in three months, 4.5% gains in six months, and 7.7% gains in a year. Those aren't "knock your socks off" returns, but it's still solid outperformance.

Again, few investors are paying attention to anything outside the U.S. But in the case of Japan, that's a mistake.

This boom is well underway... But history shows you haven't missed it yet. So if you're looking to put money to work outside the U.S., Japan is a smart choice right now.

Good investing,

Brett Eversole