Posted May 16, 2019
By Ray Blanco
Signs Still Point to the Bulls
Do bull markets die of old age?
Its an important question right now.
Back in March, the current bull market turned 10 years old. And the mainstream financial news media were quick to put on the pointy hats and pull out the birthday cake:
Wall Street's Oldest-Ever Bull Market Turns 10 Years Old, exclaimed the Reuters headline at the time
All the usual suspects CNBC, The Wall Street Journal and MarketWatch ran similar stories.
First things first the media are wrong. (Shocker!)
This isnt the oldest bull market in history. Not even close.
Have a look:
Measuring from the end of one bear market to the start of the next, this bull isnt even close to as old as the one that ripped higher from the late 1980s until 2001. That bull market run lasted 4,591 days at last count, this current one is only at 3,720 days.
Why do so many folks say that were in the oldest bull in history?
It depends how you measure a bull market.
Dont let the financial media fool you theres no official meaning for what a bull market actually is. While most folks define a bull as a 20% rally off lows and a bear as a 20% drop from highs, the fact is those numbers are pretty meaningless.
Looking back at 99 conventionally defined bear markets since 1927, the median length of a bear has been just three days.
By the time you identify a bear market by the standard 20% rule, its pretty much worthless.
If you change the definition of a bear market, suddenly this one doesnt look so old anymore.
Change it by a measly percentage point and we technically entered a brief bear market back in the final days of December 2018 when the S&P 500 slid 19.7% from its highs.
Or change the definition to include intraday drops below the 20% threshold and this bull market actually ended back in 2011.
Talking about the oldest bull market in history makes the market environment seem like uncharted territory.
Fact is, the market environment were in now isnt uncharted or even unusual.
Long term, were in a pretty textbook example of a buy the dips market.
Looking at the data, the odds favor more upside in stocks for the rest of 2019.
And thats no bull.
For Technology Profits Daily,
Jonas ElmerrajiChief Quantitative Expert/CMT, Technology Profits Daily