Audrey Deschenes
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The bull market in stocks is not dead

It’s in an expected decline until the next phase hits later this year, says Ron Meisels

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Ron Meisels, founder and president of Phases & Cycles, expects the bull market for U.S. stocks to stretch through 2016.

The chart below shows how the current bull market unfolded.

Phase 1 lasted from March 2009 to April 29, 2011, when the S&P 500 more than doubled. But then the market entered a classic seasonal swoon, plummeting almost 20% amid the second big Greek debt crisis and the debt-limit showdown in Washington, D.C., that cost the U.S. its AAA sovereign-debt rating from Standard & Poor’s.

From the Oct. 3, 2011 low of 1,099, the S&P nearly doubled again to a May 21 all-time closing high of 2,131. It hit its recent low of 1,867 on Aug. 25. The day before, the CBOE Volatility index VIX, -1.38% spiked briefly to 53, higher than it was even in 2011.

As the next chart shows, Meisels thinks the Dow “broke down through its major support in the low 17,000s [and] the major bull market trend line has been pierced.”