We momentarily entered an official bear market when the S&P 500 fell 20% for the third time.
The stock market rallied today with the SPY and NASDAQ up almost 2%.
Media seems to be in denial, but bear rallies turned into a bear market a while ago, without the official title.
And although today seems to be a green day – the question is, how long will this bear market last for?
Let’s discuss it below.
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Stocks have tumbled all year
Taking a look at the SPY (S&P 500), and we’ll find that the index is down 17% year-to-date.
The top 500 companies in this index have also been down trending all year.
Tech companies have taken a heavy hit this year.
And the NASDAQ shows it.
The NADAQ is down more than 27% this year-to-date.
Netflix (NFLX) is down almost 69%, Tesla (TSLA) is down 44%, and Apple (AAPL) stock 22%.
Hedge funds deeply invested in tech companies have suffered big losses this year already.
The Tiger Cubs are a group of hedge fund managers who are currently treading in dangerous waters.
These asset managers are ditching many positions creating massive selloffs, according to SEC filings.
Stocks rebounded today – how long will these bear rallies last?
The stock market bounces back
The stock market has momentarily bounced back staying clear from bear market territory.
SPY stock seems to be making its way back to the $400 per share level.
I’ve mentioned in previous articles and videos that the SPY seems to be respecting the $400 per share level relatively well.
Although stocks officially entered bear market territory, it’s very possible the SPY and market in general are bottoming out.
Stocks have seen all-time lows during these bear rallies but have since come up from these surprising lows.
Robinhood (HOOD) hit a low around $8 and change, now it’s trading above $10 again.
AMC Entertainment reached $9 and change, went back up to $13, and is currently trading close to $12.
GME stock on the other hand seems to have a hard time getting below $90.
The stock rose to $100 per share last week and is currently trading at $96 per share after it announced the launch of its new crypto and NFT wallet.
Related: These Two Signs Will Tell You a Short Squeeze is Over
Honestly, it’s a 50/50
I stated in a recent video that because we have seen mainly bear rallies all year long, it’s possible the SPY breaks downwards below $400 per share and we continue to see this downtrend.
Well, that happened last week, and we were officially, but momentarily, in a bear market.
Today we saw a small bounce back staying clear from that title.
But it’s still unclear whether the market has bottomed out yet or if there’s still room for stocks to fall.
Have the markets cooled off?
Is the market ready for a reversal?
What do you think?
Leave your thoughts in the comment section of the blog below.
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I wish like everyone else , I knew if the bear market is over. Personally I think if its not over we are close to a bottom. If I have not sold by now I am not going to . Should I have before ? Yes and bought back lower. I think it COULD be dangerous to get out now with hopes of buying a lot lower.
Let’s start a discussion! Leave your thoughts below.