What’s past is often prologue, and this Shakespearean phrase (from “The Tempest” for my fellow literary cohorts) certainly applies to financial markets. So when assessing the market’s future, it often helps to look through the lens of historical precedent.

One way to do this is to take note of key times in the political cycle to see when, generally, markets have reacted most favorably. When I did this recently, a clear correlation practically jumped up and bit me in the nose.

I found that during the first and/or second year after a presidential election, markets are most apt to make notable corrections and, according to the Stock Traders Almanac, “In the last eleven midterm election years, bear markets began or were in progress nine times.”

Interestingly, the data state, “Since 1914, the Dow has gained 50% on average from its midterm election year low to its subsequent high in the following pre-election year.” This is the key statistic for us, as we now are very close to the midterm election year low.

I suspect that when we look back on 2010, we’ll view the current climate as an outstanding buying opportunity. In fact, if historical election-cycle market data is any harbinger of the future, then 2011 could be one of the best years for stocks in a long time.