Pay no attention to that 35 percent gain in the past three months—this is still every bit of a bear market, no matter what traditional definitions say.
That, at least, is the opinion of many market pros who say that even though the surge off the March lows fits the technical definition of a bull market, a broader view indicates otherwise.
"My problem with saying we're in a bull market right now is we really haven't seen this market tested," says David Twibell, president of wealth management for Colorado Capital Bank in Denver. "To me a bull market is strong enough to withstand a pullback over the course of time. We really haven't had a major pullback since those lows in March."
That early-March bottom is being treated as the low by which the market's current standard is measured.
Since then, the Dow Jones industrials have risen nearly 35 percent and the Standard & Poor's 500—the more popular barometer on trading floors—has bounced almost 40 percent.
As a matter of traditional definition, a bull market is when stocks are up 20 percent from their most recent low. Conversely, a bear market is a 20 decline from the most recent high.
So why isn't this a bull market?
"A lot of it depends on time frame," Twibell says. "If you're trying to make investment decisions that have time frames of years not months, it's awfully early to be considering this a bull market. I think the jury is still out."
And therein lies the rub.
Time makes all the difference when trying to characterize the nature of this market. While it's certainly true that stock indexes have enjoyed a remarkable resurgence since the 12-year lows reached in March, the averages are still way off the point in October 2007 when the market blew up.
Both the Dow and the S&P are down nearly 40 percent from those levels, while the Nasdaq is lower by about 36 percent.
"If you are a short-term trader then you undoubtedly feel like we are in a bull market," says Chip Hanlon, president of Delta Global Advisors in Huntington Beach, Calif. "If your viewpoint is longer than that, I think you're still operating on the notion that we're in a bear market. The bear market is 10 years old now and this bear market looks a lot like the stealth bear market of 1966 to 1982."
That period encompassed the time from when the Dow first crossed 1,000 until the last time it eclipsed it for good. There were numerous rallies along the way, but for a 16-year time period investors playing the entire market saw precious little returns.
Even for those with a short time period, this is feeling a lot like the malaise that encompassed the markets in the Johnson-to-Reagan years.
Schaeffer's Investment Research in Cincinnati deals mostly with short-term trades, but analysts there believe long-term trends show the market is still well inside bear territory—and likely to stay there for quite some time.
Analysis of 60-month and 80-month trend lines show the S&P well under the landmark, which would, if reached, put the average into the mid-1100s. Anything short of that would constitute a bear run because stocks would be unable to break that barrier.
"With respect to longer term trend lines we follow, we are still within the context of a bear market," says Todd Salamone, vice president of research at Schaeffer's. "That being said there is a lot of room to rally up to these trend lines, which would indicate a bear market rally."
Indeed, the distinction between a bull and bear market is not merely one of semantics. Many advisors plot their strategies based on the difference.
"If you have a longer-term viewpoint then you're probably still operating in the midst of a bear market and investing accordingly, with higher-than-average exposure to cash and alternative asset classes like commodities and below-average exposure to stocks," Hanlon says. "If you're a shorter-term trader, who cares? If you're a longer-term investor, that should matter."
The trappings of a bear market have been drawing an increasingly loud chorus of warnings from various parts, including across the Atlantic where UK markets are in a similar quandary.
"There has been a genuine improvement in market sentiment, but it is difficult to justify US and European stock market gains of around 30% since early March," David Kern, of Kern Consulting and an economic adviser to the British Chambers of Commerce, wrote in an analysis titled, "Premature market euphoria gives way to sober realism."
"Further declines can be expected," Kern adds, "even if the lowest point in the bear market is behind us."
That doesn't mean that investors should run and hide, but the bull-bear conflict has inspired strategies among investment professionals that guard against too much enthusiasm.
Salamone has been advising clients to hedge long individual stock positions with bearish plays on broader indexes.
"It's OK to have a bullish outlook, but there should be some caution with that as well," he says. "We're approaching it both ways."
Nadav Baum, managing director of investments at BPU Investment Management in Pittsburgh, has been using the uncertainty as a chance to buy best-of-class across the sectors and to add to inflation-hedging energy positions through plays such as the Energy Select SPDR ETF.
"With all the carnage we went through, this is the opportunity of a generation to own great companies at just ridiculously low valuations," Baum says. "Wall Street can deal with recessions—we had 10 in the last 60 years. The abyss, the true crisis mode, is over."