Is this the start of the Bear?

It has been a brutal December market, maybe the worst ever in modern times (down close to 10% now for the month). I was planning for a Santa rally and so far he is missing in action. But here is the interesting thing looking at past bear markets: Even during the worst of the worst bear markets there was normally a retracement rally that would take the market up 10 to 13%. So with the S&P now down about 15% from its peak (now around 2500) that type of rally would get us back to 2775 to 2800. Now that would certainly be a welcome selling opportunity for anyone long. The problem with timing such an event would be to assume that the 15% dive to 2500 is the near term bottom. There were a couple bear markets in the past where the retracement rally didn't start until the market was already down around 20% from the previous highs, so sticking one's neck out to purchase and anticipate such a rally could be painful for awhile. The average area for a retrace would be about the 15% we are down now.

The other point here is that maybe this is not a bear market at all and therefore any purchases would be very smart in hindsight. The leading economic indicators are flashing warnings only modestly... not quite the stuff of bear markets yet (although that could change quickly). At any rate, my personal strategy will be to sell everything I purchased here in December during late January and into February. So sort of a bear market bounce and January effect combo trade. We shall see.