Market Bounce or Bull Run? Analysts Urge Caution Despite Strong Gains
Markets surged on Wednesday in what some hope marks the beginning of a new bull cycle—but seasoned analysts are urging caution, warning that the rebound may be just another head fake in a broader downtrend.
The S&P 500 posted its strongest single-day gain since 2008, while bitcoin (BTC) and the broader crypto market—tracked by the CoinDesk 20 (CD20)—also saw major upside. The rally followed President Donald Trump’s announcement of a 90-day tariff freeze for most U.S. trading partners, excluding China.
The move set off a wave of optimism on social media, with some declaring the start of a sustained bull market. However, experts like those at Goldman Sachs are pushing back on that narrative, highlighting the historical tendency for sharp recoveries to occur even during prolonged bear markets.
“Bear market rallies are not unusual,” wrote Goldman strategist Peter Oppenheimer in a research note titled ‘Bear Market Anatomy – The Path and Shape of a Bear Market.’ “Even modest changes in sentiment or positioning can drive significant market reactions during bear phases.”
According to Goldman, there have been 19 notable bear market rallies globally since the 1980s, with the average bounce lasting 44 days and generating 10%–15% returns on the MSCI AC World Index.
Callum Thomas, founder of Topdown Charts, echoed the sentiment, citing the 1930s as a prime example. “That era saw multiple double-digit rallies before the market found a true bottom. Is this latest bounce just another bear market rally?” he asked in a post on X.
Despite the optimism, several key indicators of a market bottom—like deep undervaluation, oversold investor positioning, major policy interventions, and improving macro data—have yet to materialize.
Further complicating the outlook: the Federal Reserve remains on the sidelines, and Trump’s tariff pause is only temporary. Meanwhile, levies on Chinese imports continue to climb, and valuations in equity markets remain elevated.
In short, while Wednesday’s rally was impressive, it may be too early to celebrate. For now, whether we’re at the dawn of a new bull run or simply witnessing a classic bear market bounce remains uncertain.
