Bull Market Check-Up

Below we have updated our table of historical S&P 500 bull markets (at least a 20% gain that was preceded by at least a 20% decline) since index data begins in 1927. The table is sorted by bull market length. The current bull market that started on March 9th is now 219 calendar days with a gain of 61.41%. As shown, the median gain for all bull markets has been 68%, and the median length has been 308 days.

The current bull is still below the median in terms of both gains and days. However, there aren't a lot of bulls bunched up around the median, and there is a pretty big deviation between all of them. Bottom line though is that this is definitely a bull market.

Comments

[Michael2343:]

Just from memory, scanning some of those years listed, lot of the "bull markets" occurred in the context of a far larger, overwhelming bear markets. One of them in which the stock market lost 89% of its value. Just imagine buying at the top of each of those bulls thinking its safe! That would sure make for a bad decade.

Oct 15 05:58 PM

[aarc:]

Let's tighten the spread shall we?

Looking at your table, the spread can go between 21.4% to 582%. That is an extremely wide spread, you can throw a dart blindfolded and a higher chance you will be able to hit any of the targets within that spread.

There are 4 possible scenarios for the bulls using the current structure of the SnP500 on it's daily and weekly charts using EW.

Scenario #1. We are now approaching a 1-2-3-4-5 wavecount on the daily chart from the July low with target range of 1090 to 1108. This will be a 1-2-3 wavecount on the weekly chart.

Meaning, IF we go down from here without going above 1108 then it will take another 2 to 4 months of correction or consolidation that should not go below 956 before the next rally can follow toward 1170 area for a complete 1-2-3-4-5 wavecount on the weekly chart.

After a rally toward 1170 area, SnP will need a major correction that can last a year to 2 years and can result in a minor recession or a garden variety type of recession but SnP will not go below 667 again for years and decades to come.

Scenario #2. The 5th wave for a 1-2-3-4-5 run from the March low of 667 is already underway with the July low as the 2nd wave and the Oct 2 low of 1020 as the 4th wave.

This scenario should break above the maximum allowed rally under scenario #1 of 1108 and should result in a rally with minimum target 1112 and normal target 1137 and a maximum allowed run rate of 1169.

Nominal target or highest probability target of 1137 target should be reached in 16 to 17 days from the 1020 low using the daily chart for duration estimate. Scenario #1 with maximum allowed run rate of 1108 has a timeline of 10 to 11 days and we are now 10 days from the 1020 low. We are now at a critical timeline stage as far as scenarios #s1 and 2 are concerned.

Under scenario #2, SnP will have to undergo a major correction or consolidation range that should last 8 to 16 months and can go down with a very wide range. This scenario can also result in a moderate recession or garden variety type of recession as scenario #1 after the 1-2-3-4-5 rally from the March low on weekly chart has completed but will need less time to correct before the next recovery rally toward 1576 high can happen.

3. Running correction scenario from the March 667 low to July low of 869. This scenario will enable SnP to go vertical up breaking above the 1108 and 1169 imposed limits under scenarios #1 and #2. SnP should rally above 1207 under this scenario but less likely to exceed 1396 before it will require 2 to 6 months of shallow correction and go for 1396 to 1560 or even perhaps 1576 before SnP will need a major correction that can last 1-1/2 to 3 years .

This scenario should result in a major correction that can result in a garden variety type of recession but not a severe recession that we had late 2008 to early 2009.

This scenario is the most bullish but will require a longer time to correct before the next bull run can happen and the correction can be more severe than that required of scenarios #1 and #2 but definitely not as bad as that of Oct 2007 to March 2009 run down.

Scenario #4. The running triangle scenario that has developed from Aug 7 to Oct 2. Under this scenario, the whole run up from March 667 low can be corrective in nature as part of an ongoing secular bear market that has started since the year 2000 . It means SnP will have to go vertical up as a vertical as possible on any chart pattern toward 1163 minimum target. Theoretically there is no maximum target for a running triangle but I usually set 362.8% run rate and that rate seldom got exceeded by running triangles I have analyzed. So the maximum allowed "thrust" run for the running triangle is 1339 for SnP500 under this scenario. This will require the weekly chart to have green bars every week until 1163 had been reached and/or exceeded but not breaking above 1339 from the 1020 low which is the start of the "trust" up for the running triangle scenario.

Under this scenario, we may end up going vertical selloff back down to 1020 before the bulls may try to rally again but more likely will fail and we go below 1020 and may even try to go below the March low of 667 before the next phase of multi-decade rally can start.

This scenario is similar to the 1965 to 1980 consolidation range which was a prolonged secular bear market.

Scenarios #s 1, 2, and 3 assumes that the last low of 667 is already intact and SnP will recover back to 1576 high of Oct 2007 within 4 1/2 years from the March 2009 low of 667.

Good luck for the bulls.

For the bears, there are 3 potential scenarios from the current stage if we go down from here and 1108 remains unbroken for at least the next 3 months.

But that is a different matter all-together. One step at a time, the bulls are holding the ball as of right now and they may or may not give the ball back to the bears this week or next or for the next few decades for that matter.

IF we melt down next week, then the bear case scenarios will start kicking in.

Oct 16 03:06 AM

[Novice Trader:]

At the beginning of October, when everyone thought that "the big correction" has finally arrived, I stated that I had heard the same thing from the day naysayers at the beginning of August and September. I got lambasted for pointing this out. I further stated that we'd be right back up to where we were, prior to the beginning of the month dip by the end of this month. If fact, it only took a week or two.
We're in a Bull Market. We're in a recovery. The world is not going to end in 2012.

Oct 16 09:11 AM

[Alphameister:]

The parallel with 1938 is all too eerie and should give pause, at this point, to those expecting further substantial gains from this bull market. If 2000 was the major top and analogous to 1929, then a top occurring around now would keep the analog intact.

Oct 16 10:18 AM

[bartpr:]

the secualr bear can be down for 16- 20 some years and still have substantial rallys in between. can many call these rallys. i think not.
since 2000 the trend has been down. maybe in 5 years a new secular bull will occur. till then be careful. i am only 20% in stocks since my age is 70 and i am retired.

Oct 17 08:25 PM