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Market regimes, forecasting methodology and signal literacy
Research notes and plain-English explainers from the team behind RegimeSignal™ — how market regimes work, how forecasts should be tested, and how to read a warning without overreacting to it.
What Is a Market Regime? A Plain-English Guide for S&P 500 Investors
Markets do not move in one continuous mode. They shift between distinct states — each with its own volatility behaviour, breadth profile and reaction to news. Those states are what RegimeSignal™ calls regimes, and identifying which one is active is a different exercise from forecasting a price.
Read article →Why Point Forecasts Fail and Regime Classification Holds Up
Every December brings a fresh set of index price targets, and every December the previous year's targets quietly disappear. The problem is not the forecasters. It is the format.
Read article →How to Read an Early-Warning Market Signal Without Overreacting
The most common mistake with a market warning is treating it as a command. A signal is a statement about conditions and probabilities — useful precisely because it arrives before the outcome is obvious, and therefore before it feels comfortable to act on.
Read article →Correction vs Bear Market: What's the Difference?
A correction is a sharp decline that leaves the prevailing uptrend intact. A bear market is a change of regime — the conditions underneath the market, not just the price, have shifted. The distinction matters because the two resolve in completely different ways.
Read article →The Full Market Cycle, Stage by Stage
A full market cycle moves through a recognisable sequence of stages, each defined by its own breadth, credit and volatility behaviour. Knowing which stage is active is more useful than any single price target, because the stage determines how the market will respond to whatever happens next.
Read article →What Is the Sahm Rule? A Recession Indicator, Explained
The Sahm Rule is a real-time recession indicator that watches how far the unemployment rate has risen above its recent low. It was designed by economist Claudia Sahm to flag that a recession has likely already begun, using data available at the time rather than revised history.
Read article →Pullback vs Correction: What's the Difference?
A pullback is a shallow, short-lived dip that leaves the prevailing uptrend intact. A correction is a deeper, broader repricing that changes market structure — breadth, volatility and credit behave differently, and the recovery takes longer. The distinction is about structure, not just depth.
Read article →How Do You Know a Bear Market Has Ended?
A bear market ends when the conditions that created it reverse — participation broadens, credit stress eases, volatility normalises and selling pressure stops being indiscriminate. It does not end because the index has recovered a set amount; that test can only be applied afterwards.
Read article →What Is an Out-of-Sample Backtest? And Why It Matters
An out-of-sample backtest evaluates a model on data that was not used to build it. It exists because a model can always be made to look good on the history it was fitted to — and that flattering result says nothing about whether it will work next time.
Read article →Leading vs Lagging Market Indicators: What's the Difference?
A leading indicator moves before the condition it describes; a lagging indicator moves after it and confirms it. Most widely quoted market and economic data is lagging or coincident, which is why so much commentary explains a regime change only once it is already visible in prices.
Read article →Early warning, before consensus.
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