Are We in a Cyclical Bull or Cyclical Bear Market?

by: Roger Nusbaum

Are we in a cyclical bull market in a secular bear market? Can the markets make new lows?, asks Roger Nusbaum (wish list). To tell the truth I don't think it matters whether we are in a secular bear market.

If the market makes no real ground to speak of for the next decade, is that really a bear market? Maybe but I don't really care. I tend to focus on the next year or so. I have started to write more about 2006 lately as I think I have more visibility for 2006 than we had last spring.

Almost every participant in the annual Businessweek survey that predicts the coming year for the market gets it wrong, so how is the same crew going to get it right for a period of many years?

Regardless of the proper label, an investor needs to understand past similar periods in market history, be in touch with current market events and blend those together to come up with an opinion of what might be next. Going hand in hand with that should be a counter strategy of changes to make in case the analysis turns out to be wrong.

Obviously I am describing my approach. A person that thinks of themselves as a swing trader should care about other things. Again though, I doubt too many swing traders are concerned with whether this is a secular bear market either.

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