Is the Bull Market Over?

Is the Bull Market Over? How Do You See It?

We look at it from various angles to understand whether the bull market is over or not.

Major stock indices are one of them. As of now, the S&P 500, NASDAQ and Dow Jones Industrial Average have been on an upward trend, frequently reaching new highs recently.

What About Macroeconomic Factors?

Inflation remains stubbornly high.

That has also raised inflation expectations, even as the European Central Bank and Canada have recently cut interest rates. Federal Reserve Chairman Jerome Powell said in semiannual monetary policy testimony before the Senate Banking Committee yesterday that the labor market is strong but not overheating.

The Fed is not in a position to cut rates until it is more confident that inflation is heading toward 2%. It requires constant monitoring and a strict commitment to the 2% inflation target to ensure that long-term inflation expectations remain stable.

What is Their Impression of Market Sentiment?

Recently, the crypto market has been affected by news such as the German government continuously selling BTC, Mt. Gox starting to repay creditors, and miners selling BTC.

This increased risk aversion in the market, causing BTC to decline by more than 20% and altcoin prices to drop significantly. Overall, sentiment in the crypto market is pessimistic.

How Do You Compare the Past and the New Era?

Historically, significant pullbacks have typically occurred due to factors such as regulatory policies, macroeconomic conditions and market sentiment.

The end of a bull market typically occurs against a backdrop of a noticeable slowdown in economic growth, rate hikes and balance sheet reductions. In general, from a macroeconomic perspective, there is no clear indication of when rate cuts will occur, and no rate hikes are currently expected.

The continued strength of major stock indexes reflects strong investor sentiment. While the crypto market has been on the rise since the approval of the BTC ETF, recent negative news about major institutions like the German government selling BTC has led to risk aversion.

Overall, the bull market is likely not over yet. The market outlook after quantitative easing is still promising. Ahead of that, investors need to closely monitor changes in market fundamentals and develop sensible investment strategies to cope with potential market volatility.