Bear markets are generally accepted to be a period in which the major indexes are 20% below their most recent high, maintained for a duration of two months. We don’t say we’re in a bear market the trading day we trade below 20% because then we have situations like today where we bounce back out of bear territory during the next trading period. From a technical perspective this is important for those of us who model bear markets, because it’s not unusual for a market to test around 20% (and some important moving averages) and then bounce for months before a true bear, if we get one at all.
Of course, none of that is to say we won’t enter the start of (what in hindsight turns out to be) a bear market tomorrow. But, we should fight for accuracy in the face of irresponsible media reports that conflate “bear territory” (something I’ve never heard analysts talk about) and “bear markets.”
Source: am a PM and economist.
Submitted December 26, 2018 at 06:35PM by farts_on_boobs http://bit.ly/2AfwfV2
