The S&P 500 is stuck in a long-term bear trend that will last until October 2012, technical analyst and independent trader Bill McLaren told CNBC Friday.
Even though the index has seen strong gains in the second half of 2010, the longer-term pattern is still negative, according to McLaren. It's currently forming a "broadening top," which could spell the end to the index's strength, he said.
"Once this broadening top is complete, we're going to have a bear trend that will run until October 2012," he said.
"This is a ten-year cycle the index is following. There was a five-year bull cycle … now we're doing a five-year bear cycle," McLaren added.
The index has seen a relatively small correction down from its recent run higher and "therefore holds the uptrend in strong position for the next advance, if it can hold here," he said.
"The question is now: was the move down a counter-trend that's now complete for the next rally, or is this rally a counter-trend move that when complete will allow us to drop down to … 1,146 (points)?" he added.
A significant move lower could trigger a sharp selloff for the index, according to McLaren.
"A new low from here is going to jam the index down to 1,146 (points)," he said. "The ideal completion of this bull campaign is early March."