Resolution criteria

A bull market is defined as a rise of 20% or more in a broad market index over at least a two-month period. This market resolves YES if the S&P 500 experiences a decline of 20% or more from its peak during 2026, ending the current bull market. It resolves NO if the S&P 500 remains above 20% of its peak throughout 2026.

Resolution will be determined by checking the S&P 500 historical data at MarketWatch or the Federal Reserve Economic Data (FRED) database.

Background

The current bull market was born in the fall of 2022, and since bottoming out on October 12, 2022, the market has surged nearly 100%. As of December 19, 2025, the S&P 500 stands at a historic crossroads, having successfully navigated its third anniversary and ventured into the often-prosperous "Year Four" of its current cycle.

Historical data indicates that once a bull market survives its third year, the statistical probability of it continuing into a fourth year jumps to roughly 86%. The S&P 500 has added an average of 21% annually during past bull markets, so history says the index could deliver double-digit gains for the fourth consecutive year in 2026.

Considerations

The S&P 500's price-to-earnings (P/E) ratio sits at a lofty 25x—the highest ever recorded for a bull market entering this stage. Bull markets can end due to higher interest rates triggered by inflation spikes, economic slowdowns triggering layoffs and decreased consumer spending, or global shocks like wars or pandemics. Valuations are stretched, and President Trump's tariffs could hinder economic growth.