A bull market cycle is a market cycle in which the overriding trend is up. Typically, it has an initial upward phase that lasts four to five years. Then, this phase is followed by a sharp correction spanning one to two years, another rally of four to five years, a mild mid-cycle correction, and finally a major bull market top. In a bull market cycle, the average price-to-earnings ratios begin to expand, interest rates tend to fall, and inflation retreats (though asset prices usually rise). Bull market cycles can be classified as cyclical bull market cycles and secular bull market cycles.

On the other hand, a bear market cycle is a market cycle in which the overriding trend is down. Typically, it starts with a market crash that lasts for a couple of years or so, and is succeeded by a rally of four to five years. Then, it is followed by a second bear market crash lasting for approximately two years, a two-year bear market rally, a major bear market low, and finally a final bear market low, heralding the end of the bear market cycle. In a bear market cycle, the average price-to-earnings ratios begin to shrink, interest rates tend to rise, and inflation picks up. Bear market cycles are typically classified as cyclical bear market cycles and secular bear market cycles.

The following table summarizes the key differences between the two cycles: