Since the bear market began in late 2007, the Dow Jones industrial average has fallen into a pattern of huge declines, big gains, and then even larger declines. Four times, the market has rallied only to dissipate.
This past week, the market made a fifth stab at recovery, logging its best performance in months after remarks from bank CEOs and economic data led investors to believe they'd gotten too pessimistic.
"People have been worried that we're heading into this abyss," said Tobias Levkovich, Citigroup's chief U.S. equity strategist. "There are signs that that's not the case, and there is some floor somewhere _ that we may have overreacted."
But is the worst really over?
There's no formula to figure out if this latest rally will stick. But market analysts are watching closely for signs that the worst might be behind us, and they say some good signs are starting to pop up.
"But it's way, way, way too premature to try to make an argument that this is 'The Bottom,' " said John Kosar, market technician and president of Asbury Research in Chicago.
Economies, like stock markets, don't decline in a straight line. The recent spate of better-than-expected retail sales data could be merely a short-term blip.
"A lot of people have been beaten and wounded, and it's going to take time to recover from that. It's more than wealth _ confidence has been rattled," Stuart Frankel & Co. president Jeffrey Frankel said, who works on the floor of the New York Stock Exchange.
Before jumping in, "everyone is looking twice," Frankel said.
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