Is a bull market on the way?
The Dow is technically bullish. But we're not out of this yet.
D.R. Barton
December 5th, 2022
Blog | Is a bull market on the way?
tl;dr
The Dow just crossed over into "bull market" territory
It's 20% from its recent bottom (back in October)
Other major indexes aren't quite there yet
We're probably not out of the woods yet
There are plenty of way to tell that a bear market is starting to turn around—but with the economy at large as topsy-turvy as it has been lately, nothing is for certain.
We've been talking seasonality in this space recently, so let's look at the history since WWII:
Chart showing relative bear market bottoms since WWII.
Most bear markets in recent history, as it happens, have bottomed out in October.
How's that working out this time?
Sure enough: the Dow is officially in bull market territory
As of the close on Nov. 30, 2022, the Dow Index had officially entered bull market territory. That’s a 20% gain on a closing basis from the bear-market low, which, you guessed it, happened in October:
Chart showing the Dow's performance in the past year.
The other major stock indexes are pushing toward bull direction, too. And for the first in quite while, I’m starting to hear investors talking about our old friend FOMO (fear of missing out).
And that’s one of the great dangers at any potential market turn: that the hype from the media or the fear of lost opportunity will make you as an investor overly active—jumping in and out, trying to find the next big wave.
Don't rush to act on this turnaround; there are plenty of strong indicators that we're not out of the woods yet.
So what to do about it? As ever: build your portfolio so that it can weather the downs while staying within your risk tolerance and ride the upside waves without undue worry about being over- or under-exposed. That what’s Finiac’s tools and training are all about.
God bless you and Great Investing,
D.R. Barton
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