In a Secular Bull Market, primary bear market trends are observed. But, these primary bear market periods cannot pull down the upward rising trend of asset prices, prevailing in the bull market. Before discussing Secular Bull Market, one needs to know the concept of secular market trend.
By secular market trend, we refer to a long-term trend, which continues for 5 years to 25 years and is formed by sequential primary trends. When secular market trends take place in Bull Market, we refer it as Secular Bull Market. In Secular Bull Market, primary bear market trends are observed.
But, these primary bear markets appear for short period. In Secular Bull Market, the more powerful positive effects of primary bull market trends offset the negative effects of primary bear markets trends. The presence of primary bear market periods in a Secular Bull Market, do not hold the power of reversing the upward rising trend of asset values. This can be explained through an example. In the period of 1980 to 2000, USA experienced a Secular Bull Market, in spite of the fact that, a stock market crash took place in the same period. Actually what happened was that, the losses generated in the primary bear market period of 1987, were recovered quickly and the stock market indexes experienced continuous rise in the next 13 years. It can be mentioned here, that in this 1980-2000 period of Secular Bull Market, the S&P 500 Index went up to 1500 from 120.
In general it can be said that in case of a Secular Market, forces, which can cause price changes of particular assets classes, drive the market. Here, by price change, price increase, price or we mean decrease of particular investments on a long-term period. In Secular Bull Market, we find that, the number of net buyers is much more than the number of sellers. So, the stock prices move to a higher level.