SecondCor521
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Hi all,
There seems to be a fairly prevalent belief that the US stock market goes in bull / bear cycles.
There also seems to be a belief - perhaps less common - that bull markets can "get long in the tooth" or "get tired". This has the usually unspoken implication that a bear market needs to occur in order to start a new bull market.
It seems pretty clear to me that if we had a 25% decline over the course of the next two years and then the market started upwards again, that most people who hold those two beliefs mentioned above would mark it as the start of a new bull market.
On the other hand, a 1% decline over the course of a few days is clearly not enough to mark the end of one bull market and the start of another.
I'm curious whether folks here think that the activity in the US stock market since late January constitutes enough of a decline over a long enough time that, if the market were to begin to go up again, you would consider it the start of a new bull market rather than the continuation of the old one.
I'm familiar with the definitions of bear markets and recessions, and I could go look up the percent declines in the various market indices, so I don't really need anyone to go into that.
More broadly, what criteria would be sufficient to you to demarcate the end of a previous bull market and the beginning of a new one? A bear market? A recession? An inversion of the yield curve? Investor sentiment? Unemployment or inflation? Sector rotation into consumer staples and utilities? Technical analysis? Feelings ("I'll know it when I see it")? Other?
In other words, what X would make you say, "After I see X, if the market goes up it's the start of a new bull market and not the continuation of the previous one?"
[Mods, if this belongs better in the stock picking forum, feel free to move. Thank you!]
There seems to be a fairly prevalent belief that the US stock market goes in bull / bear cycles.
There also seems to be a belief - perhaps less common - that bull markets can "get long in the tooth" or "get tired". This has the usually unspoken implication that a bear market needs to occur in order to start a new bull market.
It seems pretty clear to me that if we had a 25% decline over the course of the next two years and then the market started upwards again, that most people who hold those two beliefs mentioned above would mark it as the start of a new bull market.
On the other hand, a 1% decline over the course of a few days is clearly not enough to mark the end of one bull market and the start of another.
I'm curious whether folks here think that the activity in the US stock market since late January constitutes enough of a decline over a long enough time that, if the market were to begin to go up again, you would consider it the start of a new bull market rather than the continuation of the old one.
I'm familiar with the definitions of bear markets and recessions, and I could go look up the percent declines in the various market indices, so I don't really need anyone to go into that.
More broadly, what criteria would be sufficient to you to demarcate the end of a previous bull market and the beginning of a new one? A bear market? A recession? An inversion of the yield curve? Investor sentiment? Unemployment or inflation? Sector rotation into consumer staples and utilities? Technical analysis? Feelings ("I'll know it when I see it")? Other?
In other words, what X would make you say, "After I see X, if the market goes up it's the start of a new bull market and not the continuation of the previous one?"
[Mods, if this belongs better in the stock picking forum, feel free to move. Thank you!]