is this a bear market?

[fearme]

should i be in 100% cash?

[stephenNUTS]

Not by historical standards at least for now

In the past...the start of a bear market from a technical standpoint,was a correction in the major averages(the S+P and Dow) of at least 20% from the near highs established during the bull run.

With the Nasdaq market being populated in majority with tech stocks,and times changing....I am not sure if this still holds any weight

e.g. the Dow and S+P dropping in the Spring of 2000,did in no way come close in comparison to the NASDAQ (dot.com bubble collapse) from its 5000+ high in percentage terms

SF [img]/images/graemlins/cool.gif[/img]

[Foghatlive]

If you want to look at it from a trend standpoint, the Dow is below the 50,100,150 & 200 day moving averages. So, the short and long term trend is down.

I'm in cash and not feeling too bummed about it.

[Jimbo]

A bear will say yes. A bull will say no. I like Stephens answer as to a good indicator in the past. Personally I would never ever be 100% in cash with interest rates this low.

A bear market does not mean all stocks are going down in value just as a bull market does not mean they will all go up. This is a good time to either go sector shopping or sector avoiding, whichever you prefer.

Right now the financials, retail and most of tech is beaten up pretty bad. I am investing more in select stocks of all three of these sectors next week but with specific stocks in mind. Actually online retail is booming even though B$M retail is hurting. This makes MA a good buy since they have no debt, zero exposure to the subprime crisis and only process credit cards making a profit on every transaction. I also like the video game stocks and maybe even GME for a month or two. Microsoft was beaten down today with zero change in their recent fundamentals.

One last point, in tough times Pharms are good as are stocks like P&G.

Jimbo