Correctly Defining "Bear Market" - Free Weekly Technical Analysis Chart - McClellan Financial:
"A bull market is when the major averages are in an uptrend, and most stocks are doing well. An uptrend is defined as a period when prices make higher highs and higher lows. A bull market should be thought of as lasting over several months at least. You can see higher highs and higher lows on an intraday chart, but that does not make it a bull market. There needs to be persistence for a long period.
A bear market is nearly the same, except that there are lower highs and lower lows for a protracted period over several months. A bear market is when most stocks do poorly, even the most deserving ones. It hurts everyone. It gets people talking about giving up investing, and going to live in a commune. A bear market does not depend on the ultimate magnitude, but rather upon the attitude it creates.
A single stock or sector cannot be in “official bear market territory” by itself. A bear market is not a place, it is a process. And it hurts broadly, not just affecting a single stock or sector.
A “correction” is any movement which is contrary to the current trend direction, but which does not change the dominant trend direction. As such, the classification does not depend on the magnitude of the drop. It depends on what happens to the trend as a result of the movement. A correction can even be upward, if the market is in a downtrend. "
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