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US consumer sentiment has proved fickle in recent decades, gyrating unexpectedly and generally keeping investors on their toes.

But when it has stayed high for a prolonged period, it has historically unlocked massive gains for stocks.

That's exactly what is happening right now. In fact, we seem to be about halfway into one of those high-confidence periods, after University of Michigan Consumer Sentiment Index data last Friday kept the trend intact.

Sentiment has been this high for this long on just five other occasions since 1978, according to data compiled by Morgan Stanley. The S&P 500 saw a median return of 21% in the one year following each positive reading and a 42% gain over a two-year period, according to the firm's data.

The S&P 500's 17% rally since June 2016 is roughly in line with that history. And perhaps more important for market speculators, it signals that the index could have 21% to 25% left to climb over the next year.

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