When Does a Bull Market Officially Begin?

Key Concepts:

• Bare Market End
• Bull Market Start
• Market Bottom
• Recapturing Losses
• New Highs
• Choppy Period

When Does the Bare Market End and the Bull Market Begin?

The video transcript discusses the ambiguity surrounding the exact end of a bare market and the commencement of a bull market, positing that it's more of an art than a precise science. The speaker argues that the bottom of a bare market is not necessarily the beginning of a bull market.

Historical Examples and Perspectives:

• March 2009: The speaker notes that in March 2009, when the market bottomed, few people recognized it as the start of a bull market. Even by 2010, when the market had already doubled from its lows, the sentiment was not that of a bull market.
• 2010: The speaker humorously suggests that perhaps someone like "JC" might have considered it a bull market then.
• 20% Off Lows: A question is raised about whether a bull market begins when the market is 20% off its lows, using an inverse definition.
• 20% From Previous Highs: Another perspective considered is whether a bull market is reset when the market returns to within 20% of its previous highs.
• Recapturing Losses: The transcript explores the definition of a bull market start in relation to recapturing losses. For instance, after a 50% bare market, does the bull market begin when half of the losses are recovered, or only when new highs are achieved?
• 2013 Posture: The speaker states their personal stance was that the bull market officially began in 2013.
• 1974 Bottom vs. 1980s Bull Market: A contrasting example is presented: the stock market bottomed in 1974, followed by a "choppy period." However, the bull market is generally considered to have started in the 1980s, not in 1974, despite the earlier bottom.
• March 2009 Bottom and Subsequent Bull Market: In contrast to the 1974 example, the market bottom in March 2009 is described as the definitive start of a bull market, which then "shot off like a cannon." This particular bull market is characterized as a "16-year bull market" according to the speaker's definition.

Debate and Definitions:

The core argument revolves around the subjective nature of defining the start of a bull market. Different criteria are presented and debated:

• Market Bottom: While a market bottom marks the end of a decline, it doesn't automatically signify the start of a sustained upward trend.
• Percentage Recovery: The threshold for recovery (e.g., 20% off lows, recapturing half of losses) is a point of contention.
• New Highs: Reaching new all-time highs is often seen as a more definitive indicator of a bull market, but this can occur significantly after the initial recovery from a bottom.
• Market Sentiment and Recognition: The transcript implies that widespread recognition and sentiment of a bull market are also crucial, even if not explicitly defined.

Conclusion:

The video transcript emphasizes that there is no single, universally agreed-upon definition for when a bare market ends and a bull market begins. While market bottoms are identifiable, the transition to a bull market is often a gradual process with a period of recovery and uncertainty. The speaker's personal definition leans towards the sustained upward momentum and eventual new highs as key indicators, citing the March 2009 bottom as a clear example of a bull market's commencement, leading to a prolonged 16-year bull run. The historical examples highlight the divergence between market bottoms and the official start of bull markets, underscoring the complexity and interpretive nature of this market analysis.