Silver prices sank further into bear-market territory, and weak global manufacturing data stoked fears of more falls.
The SPY retested the January lows in March (point 3), setting the stage for a bear-market rally.
In 2008, there was a classic bear-market rally from the March 2008 lows that ended in May.
Typically, bear-market rallies will fail near or slightly above the 50% retracement resistance.
Many analysts say regional bourses are riding a bear-market rebound - the real economies are still in dire straits.
Material shares, down 1.4%, led declines in five of the benchmark index's 10 industry sectors as gold entered bear-market territory.
But then again, it takes lower levels of fear to carve out a short-term bottom in a bull-market environment relative to a bear-market environment.
False bottoms and bear-market rallies have trapped investors since time immemorial.
The more difficult question to answer is whether the surge is the start of a long-term bull market or simply yet another bear-market rally, like those Japan enjoyed in the 1990s.
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The brokerage expects a "major bear-market low" around the second quarter of this year, before the "best buying opportunity the country has presented investors in more than three years, " Mr. Cochran said.
After losing big time in the 2007-2009 bear market, and short-term in the current market correction, they are under pressure from their investors to take less risk.
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The first bear market rally of the 2007-2009 bear market had ended 3 days earlier on Dec. 10.
It made gains throughout the severe 2000-2002 bear market, and has significantly out-performed the market over the last 11 years.
That was most recently seen in the way the stock market topped out into the 2007-2009 bear market prior to the 2008-2009 recession, while economists and the Fed were still saying the problems in the housing sector and sub-prime mortgages would be confined to housing and would not affect the overall economy.
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The 1977-1980 bear market was a slow-motion slide into stagflation, double-digit interest rates and malaise.
The first cyclical bull market since the secular bear market began, carried the market back up to its peak of 2000 before the 2007-2009 cyclical bear market took over.
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For instance, you may not have chosen to act, but the 2007-2009 equity bear market was a slow-moving train wreck where you had ample time to make adjustments, even if you had already seen a meaningful decline in your equity portfolio.
Despite the recent run up in the market, the 2007-2009 bear market has left an indelible scar on investors.
Intel was up 140% in a year, but the 2000-2002 bear market at the conclusion of the 1995-2000 manic run turned shares of the four horsemen into horse meat.
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As the following charts show, the big spike-up in bonds at the end of 2008, which was also fueled by economic worries and a declining stock market, ended on December 18, 2008, even as worries about the economy worsened further, and almost three months before the stock market ended its severe 2007-2009 bear market (on March 10, 2009).
The last time it reached 40% was in October, 2007, as the market topped out into the 2007-2009 bear market.
It was created in 2003, after investigations into the causes of the 2000 stock market bubble and subsequent severe 2000-2002 bear market.
The stock market plunged into the severe 2000-2002 bear market, depriving the government of the healthy capital gains taxes it had been receiving.
No shame here--the company has made some smart moves, such as unloading the securities firm DLJ before the onset of the bear market--but it has not gotten the celebrated jump on the American International Group.
Did the bull market of 1982-2000 start because the 1966-82 bear market simply died of old age?
But the subsequent cyclical bear market turned out to be the beginning of a 17-year sideways secular bear market.
Abbott Labs, Bristol Myers, Eli Lilly, and Merck, plunged an average of 54.5% in the 2000-2002 bear market, and an average of 49.1% in the 2007-2009 bear.
The stock market had spiked up further into its bubble, then burst, and the severe 2000-2002 bear market was upon us.
At the important market low in early March of last year, which marked the end of the 2002-2007 bear market, the spread was minus 51%, with 70% bears and only19% bulls.
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