Stocks' summer rally may mean the worst of the bear market is over, but even so, strategists who watch charts say another big downdraft is possible in September. Some strategists, in fact, say from a technical standpoint the market could have already launched into a new bull cycle. Others disagree, saying they need more confirmation from other signals. But they all note that September is historically negative for the market — and it could be again. Watching the 50-day moving average Ed Clissold, chief U.S. strategist at Ned Davis Research, said he sees technical signs that stocks may have already entered a bull market, but he warns that fundamentals could derail the market's bullish stance. His work shows by the time 90% of common stocks are above their 50-day moving average, the market has been in a bull cycle for a median of 1.8 months. It has been two months since the mid-June low. He noted that as of Monday, about 89% of common stocks were above the intermediate moving average, but that number was more than 90% for S & P 500 stocks. The 50-day moving average is simply the average of the last 50 closing prices for a stock or index. A close above it would be a positive momentum signal. "One way to think about it is if this is a bull market which you only know in hindsight, this is how it should be going, and the technicals almost always tell you before the fundamentals and the macros," said Clissold. "I'm not dismissing the macro concerns over the Fed tightening cycle or the earnings slowdown. Those are real concerns." Spotting waypoints for stocks Stocks have been buoyed by positive momentum since setting a low in June. Strategists now say it appears that may have been the bear market low according to technical signals. The S & P 500 has been higher for four straight weeks, and the broad market index ended Monday about 18% above its June low. The market has made positive strides during the rally. For one, the S & P 500 closed Friday above 4,231, the 50% retracement or the midway point between its peak and trough. BTIG says that historically has meant the index should not set a new low in the current cycle. Strategists say that's just one signal, and it alone does not indicate a bull market has begun. "You're still below a downward sloping 200-day moving average," said Todd Sohn, technical analyst at Strategas. "The broader trends haven't changed as much as you've gotten these positive momentum signals. It's really great short-term momentum and favorable signals for the next 12 months, but tactically I would question how much gas would be in the tank." He said a downside move could take the S & P 500 to about 4,000 in the September period. 'The demarcation between bull and bear' The next major hurdle for stocks could be that 200-day moving average level on the S & P 500 — which stood at 4,327 on Monday. "That could be one day away," Sohn said. The S & P 500 finished Monday at 4,297.14. "The 200-day moving average, to us, is always the demarcation between bull and bear, very simplistically as far as a popular and common way to look at these moves," said Ari Wald, head of technical analysis at Oppenheimer. Wald said that level will be key for the S & P 500 to surpass, but he is also watching the 200-day level on individual stocks for a bull market signal. "The final signal doesn't come until 70% of stocks are above their 200-day," he said. As of Monday, that number for the New York Stock Exchange universe he watches was at 38%. "The sentiment pendulum went from extremes. I still think a lot of those bears have to capitulate," Wald said. He expects stocks to see a pullback in the September into early October time frame, before a fourth quarter rally. That would follow the pattern of midterm election years, in which the market is typically higher in the final quarter of the year. "Just because the market can pull back in September doesn't mean this isn't a bull market," said Ned Davis Research's Clissold. He said short-term sentiment indicators were showing more bullishness among investors. "There's some optimism that crept back into the market," Clissold added. "A pullback that could relieve some of the optimism could be healthy for the intermediate term." Sohn of Strategas said stocks that saw big gains recently could be especially vulnerable even now. "I think it makes sense to prune some of the those mean-reverting names, the cryptos and non-profitable tech type names. I wouldn't want to overstay your welcome too much as they had a nice bounce," he said. Sohn pointed to the big move higher in names like DraftKings , which began July at roughly $12 a share and closed Monday at $20.80. The Ark Innovation ETF , a poster child for high growth, is up about 30% since the beginning of July, but it's still down close to 45% for the year. "These were summer rentals," he said. "It's time to move out."