Editing Market trend (section)

==Primary trends==
{{anchor|Primary trends}}
A primary trend has broad support throughout the entire market, across most sectors, and lasts for a year or more.

===Bull market===<!-- This section is linked from Bull -->
[[File:Wall Street bubbles - Always the same - Keppler 1901.jpg|thumb|right|A 1901 cartoon depicting financier [[J. P. Morgan]] as a bull with eager investors]]
{{see_also|Bull (stock market speculator)}}
A bull market is a period of generally rising prices. The start of a bull market is marked by widespread [[pessimism]]. This point is when the "crowd" is the most "bearish".<ref>{{cite book | url=https://books.google.com/books?id=MW_FmuvcneEC&pg=PT222 | title=Winning on Wall Street | first=Martin | last=Zweig | author-link=Martin Zweig | publisher=[[Grand Central Publishing]] | date=June 27, 2009| isbn=9780446561686 }}</ref> The feeling of despondency changes to hope, "optimism", and eventually euphoria as the bull runs its course.<ref>[http://www.minyanville.com/business-news/markets/articles/The-6-Stages-of-Bull-Markets/4/1/2013/id/48996 The 6 Stages Of Bull Markets – And Where We Are Right Now | Markets | Minyanville's Wall Street] {{Webarchive|url=https://web.archive.org/web/20190507144545/http://www.minyanville.com/business-news/markets/articles/The-6-Stages-of-Bull-Markets/4/1/2013/id/48996 |date=2019-05-07 }} [[Minyanville]]</ref> This often leads the economic cycle, for example, in a full [[recession]], or earlier.

Generally, bull markets begin when stocks rise 20% from their low and end when stocks  experience a 20% drawdown.<ref>{{Cite web|url=https://www.investopedia.com/terms/b/bullmarket.asp|title=Bull Market Definition|last=Chen|first=James|website=Investopedia|language=en|access-date=2020-03-26}}</ref> However, some analysts suggest a bull market cannot happen within a bear market.<ref>{{Cite web|url=https://www.marketwatch.com/story/the-dow-just-entered-a-bull-market-by-some-measures-but-it-sure-doesnt-feel-bullish-on-wall-street-2020-03-26|title=Does the Dow's 21% surge in 3 days put it back in a bull market? 'The market doesn't work that way,' says one researcher|last=DeCambre|first=Mark|website=MarketWatch|language=en-US|access-date=2020-03-27}}</ref>

An analysis of [[Morningstar, Inc.]] stock market data from 1926 to 2014 revealed that, on average, a typical bull market lasted 8.5 years with a cumulative total return averaging 458%. Additionally, annualized gains for bull markets ranged from 14.9% to 34.1%.

====Examples====
:India's [[Bombay Stock Exchange]] Index, [[BSE SENSEX]], experienced a major bull market trend from April 2003 to January 2008. It increased from 2,900 points to 21,000 points, representing a more than 600% return in 5 years.<ref name=BSE-history>{{Cite web |title= Historical Data |url=https://www.bseindia.com/Indices/IndexArchiveData.html |website=BSE India |access-date=22 June 2023}}</ref>
:
:Notable bull markets characterized the 1925–1929, 1953–1957, and 1993–1997 periods when the U.S. and many other stock markets experienced significant growth. While the first period ended abruptly with the start of the [[Great Depression]], the end of the later time periods were mostly periods of [[Soft landing (economics)|soft landing]], which became large bear markets. (see: [[Recession of 1960–61]] and the [[dot-com bubble]] in 2000–2001)

===Bear market===
[[File:Bear Sculpture IFSC House.jpg|thumb|right|Sculpture of stock market bear outside [[International Financial Services Centre, Dublin|International Financial Services Centre]], Dublin]]
A bear market is a general decline in the stock market over a period of time.<ref>{{cite book | url=https://books.google.com/books?id=vfxAHAAACAAJ | first1=Arthur | last1=O'Sullivan | first2=Steven M. | last2=Sheffrin | title=Economics: Principles in Action | publisher=[[Prentice Hall]] | year=2003 | page=290 | isbn=0-13-063085-3}}</ref> It involves a transition from high investor [[optimism]] to widespread investor fear and pessimism. One generally accepted measure of a bear market is a price decline of 20% or more over at least a two-month period.<ref>{{Cite web | url=https://www.investopedia.com/terms/b/bearmarket.asp | title=Bear Market | publisher=[[Investopedia]]}}</ref>

A decline of 10% to 20% is classified as a [[Market correction|correction]].

Bear territory always precedes a bear market. Typically, as a market enters bear territory, there are indicators other than a correction. The Cboe Volatility Index ([[VIX]]), a key measure of market volatility, increases, indicating heightened investor anxiety. Additionally, [[Consumer confidence|consumer sentiment]] drops, with expectations for [[unemployment]] rising and [[Economic forecasting|economic outlooks]] declining.<ref>{{Cite web | url=https://www.reuters.com/markets/us/investors-grapple-with-tariff-driven-economic-threat-market-swings-persist-2025-04-11/ | title=Economic Threat| publisher=[[Reuters]]}}</ref> Most recently (as of April 12, 2025), in April 2025, the United States stock market entered bear territory.<ref>{{Cite web | url=https://apnews.com/article/bear-market-stocks-market-tariffs-trump-sp-500-c5d106a80666c0ff4f0e71624d525158 | title=Bear Market | publisher=[[AP News]]}}</ref> The [[S&P 500 Index]] declined over 20% from its recent peak, meeting the technical definition of entering bear territory. This downturn is primarily attributed to escalating trade tensions and [[Tariffs in the second Trump administration|tariff policies under the Trump administration]], which have led to significant market [[Volatility (finance)|volatility]] and investor uncertainty.<ref>{{Cite web | url=https://www.businessinsider.com/stock-market-crash-long-way-to-go-tariffs-consumer-sentiment-2025-4 | title=Market Crash| publisher=[[Business Insider]]}}</ref> Ultimately, when a market enters bear territory, it almost always leads that stock market into a bear market.

Bear markets conclude when stocks recover, reaching new highs.<ref>{{cite news|last=DeCambre|first=Mark|url=https://www.marketwatch.com/story/stop-saying-the-dow-is-moving-in-and-out-of-correction-that-is-not-how-stock-market-moves-work-2018-03-23|title=Stop saying the Dow is moving in and out of correction! That is not how stock-market moves work|date=April 6, 2018|work=[[MarketWatch]]}}</ref> The bear market is then assessed retrospectively from the recent highs to the lowest closing price,<ref>{{Cite web|url=https://www.businessinsider.com/illustration-of-bull-and-bear-markets-2014-12|title=This Is The Best Illustration Of History's Bull And Bear Markets We've Seen Yet|last=Ro|first=Sam|website=Business Insider|access-date=2020-03-18}}</ref> and its recovery period spans from the lowest closing price to the attainment of new highs. Another commonly accepted indicator of the end of a bear market is indices gaining 20% or more from their low.<ref>{{Cite news|last=Driebusch|first=Georgi Kantchev and Corrie|url=https://www.wsj.com/articles/global-stocks-waver-after-weak-economic-data-11550220104|title=Nasdaq Exits Bear Market as Stocks Rally|date=2019-02-15|work=Wall Street Journal|access-date=2020-03-18|language=en-US|issn=0099-9660}}</ref><ref>{{Cite web|url=https://www.marketwatch.com/story/the-nasdaq-is-on-pace-to-end-its-longest-bear-market-in-nearly-30-years-2019-02-13|title=The Nasdaq escapes longest bear market — by one measure — in 28 years|last=DeCambre|first=Mark|website=MarketWatch|language=en-US|access-date=2020-03-18}}</ref>

From 1926 to 2014, the average duration of a bear market was 13 months, accompanied by an average cumulative loss of 30%. Annualized declines for bear markets ranged from −19.7% to −47%.<ref>{{cite news | url=https://www.cnbc.com/2018/10/26/the-stock-market-loses-13percent-in-a-correction-on-average.html | title=The stock market loses 13% in a correction on average, if it doesn't turn into a bear market | first1=Thomas | last1=Franck | first2=Kate | last2=Rooney | work=[[CNBC]] | date=October 26, 2018}}</ref>

====Examples====
Some examples of a bear market include:
* The [[Wall Street Crash of 1929]], which erased 89% (from 386 to 40) of the [[Dow Jones Industrial Average]]'s [[market capitalization]] by July 1932, marking the start of the [[Great Depression]]. After regaining nearly 50% of its losses, a longer bear market from 1937 to 1942 occurred in which the market was again cut in half. 
* A long-term bear market occurred from about 1973 to 1982, encompassing the [[1970s energy crisis]] and the high unemployment of the early 1980s. 
* A bear market occurred in India following the [[1992 Indian stock market scam]] committed by [[Harshad Mehta]].
* The [[Stock market downturn of 2002]].
* Due to the [[2008 financial crisis]], a bear market occurred between October 2007 and March 2009. 
* The [[2015 Chinese stock market crash]]. 
* In early 2020, the [[COVID-19 pandemic]] caused multiple [[2020 stock market crash|stock market crashes]], leading to bear markets across the world.
* In 2022, concerns over an [[2021–2022 inflation surge|inflation surge]] and potential rises of the [[federal funds rate]] caused a bear market.<ref>{{cite news |title=The S&P 500 is in a Bear Market; Here's What That Means |url=https://www.voanews.com/a/the-s-p-500-is-in-a-bear-market-here-s-what-that-means/6616498.html |access-date=14 June 2022 |work=VOA |date=13 June 2022 |language=en}}</ref>

===Market top===
A market top (or market high) is usually not a dramatic event. The market has simply reached the highest point that it will, for some time. This identification is retrospective, as market participants are generally unaware of it when it occurs. Thus prices subsequently fall, either slowly or more rapidly.

According to [[William O'Neil]], since the 1950s, a market top is characterized by three to five distribution days in a major [[stock market index]] occurring within a relatively short period of time. Distribution is identified as a decline in price with higher volume than the preceding session.<ref>{{cite web |url=https://www.investors.com/how-to-invest/investors-corner/know-this-sell-rule-when-distribution-days-pile-up-in-the-stock-market/ |author=David Saito-Chung |title=Know This Sell Rule: When Distribution Days Pile Up In The Stock Market |date=8 November 2016 |publisher=Investors.com}}</ref>

====Examples====
The peak of the [[dot-com bubble]], as measured by the [[NASDAQ-100]], occurred on March 24, 2000, when the index closed at 4,704.73. The [[Nasdaq]] peaked at 5,132.50 and the [[S&P 500 Index]] at 1525.20.

The peak of the U.S. stock market before the [[2008 financial crisis]] occurred on October 9, 2007. The [[S&P 500]] closed at 1,565 and the NASDAQ at 2,861.50.

===Market bottom===
A market bottom marks a trend reversal, signifying the end of a market downturn and the commencement of an upward-moving trend (bull market).

Identifying a market bottom, often referred to as 'bottom picking,' is a challenging task, as it's difficult to recognize before it passes. The upturn following a decline may be short-lived, and prices might resume their descent, resulting in a loss for the investor who purchased stocks during a misperceived or 'false' market bottom.

[[Nathan Rothschild, 1st Baron Rothschild|Baron Rothschild]] is often quoted as advising that the best time to buy is when there is 'blood in the streets'—that is, when the markets have fallen drastically and investor sentiment is extremely negative.<ref>{{Cite web | url=https://www.investopedia.com/articles/financial-theory/08/contrarian-investing.asp | title=Contrarian Investing: Buy When There's Blood in the Streets | publisher=[[Investopedia]]}}</ref>

====Examples====
[[File:The Battles of Bulls and Bears (Harper's Weekly, September 10, 1864).jpg|thumb|The Battle of the Bulls and Bears (''Harper's Weekly'', September 10, 1864)]]
Some more examples of market bottoms, in terms of the closing values of the [[Dow Jones Industrial Average]] (DJIA) include:
*The Dow Jones Industrial Average hit a bottom at 1,738.74 on October 19, 1987, following a decline from 2,722.41 on August 25, 1987. This day is commonly referred to as Black Monday (chart<ref>{{Cite web|url=https://stockcharts.com/h-sc/ui?s=$INDU&p=D&st=1987-08-01&en=1987-12-31&id=p95907824619|title=$INDU – Dow Jones Industrial Average|website=stockcharts.com|accessdate=Mar 17, 2023}}</ref>).
* A bottom of 7,286.27 was reached on the DJIA on October 9, 2002, following a decline from 11,722.98 on January 14, 2000. This decline included an intermediate bottom of 8,235.81 on September 21, 2001 (a 14% change from September 10), leading to an intermediate top of 10,635.25 on March 19, 2002 (chart<ref>{{Cite web|url=https://stockcharts.com/h-sc/ui?s=$INDU&p=D&st=2000-01-01&en=2002-12-31&id=p94927308656|title=$INDU – Dow Jones Industrial Average|website=stockcharts.com|accessdate=Mar 17, 2023}}</ref>). Meanwhile, the "tech-heavy" Nasdaq experienced a more precipitous fall, declining 79% from its peak of 5,132 on March 10, 2000, to its bottom of 1,108 on October 10, 2002.
*A bottom of 6,440.08 (DJIA) on 9 March 2009 was reached after a decline associated with the [[subprime mortgage crisis]] starting at 14164.41 on 9 October 2007 (chart<ref>{{cite web | url=https://stockcharts.com/h-sc/ui?s=$INDU&p=D&st=2007-06-01&en=2009-05-17&id=p70946023540 | title=$INDU – SharpCharts Workbench | publisher=StockCharts.com}}</ref>).