... and, Where are We Now?

First, a "market bottom" call is typically a speculative conjecture based on anecdotal stories and some improving data suggesting that a market downturn may be ending.

Often times, the improving data is not positive, but merely "not as negative as before".

It is from an improvement of "not as bad as last time", that some investors assume a conclusion that there is "a trend of improvement occurring that will continue into a turnaround where everything will become positive soon".

Remember the old saying, "the trend is your friend". The opposite was also inferred ... "going against the trend is your enemy".

If speculative conjecture is or was correct, then the stock market's trend would have also changed to an "up trend" from a "down trend". If that has not happened, then there is no "proof" that the speculation of a market bottom was indeed true.

So, let's look at the stock market's trend, and we will look at it on the New York Stock Exchange because that is where most of the Institutional trading is done.

Note the red arrows in the chart below. We have a low, followed by a high, followed by a lower/low on the NYA Index. The NYA Index is currently moving up ... BUT, it has not made a higher/high yet.

By definition, down trends are conditions with lower/highs and lower/lows. Up trends, are conditions with higher/highs and higher/lows.

So far, we still have lower/highs and lower/lows. Until a higher/high is made, this is still a down trend.

After a higher/high is made, you need to see a higher/low followed by another higher/high for a new up trend to be verified.

Conclusion: We have not had a trend reversal yet. Yes, things appear to be improving, but the market is not entirely convinced of the sustainability of the improving conditions yet.