Market Cycle
The recurring pattern of rising and falling market prices, related to but distinct from the underlying economic cycle.
How it is identified
Phases commonly described as accumulation, mark-up, distribution and mark-down
Unit
qualitative
In depth
Market cycles lead economic cycles, typically by several months, because prices reflect expectations rather than current conditions — which is why markets often bottom while the news is at its worst. Their length and amplitude vary so widely that knowing cycles exist provides no timing information. The four-phase description is a narrative applied retrospectively, and identifying the current phase in real time is contested even among professionals. Its practical value is understanding that both directions are normal, which supports staying invested through a decline rather than predicting one.
Worked example
Equities can bottom four to six months before GDP does. An investor acting on confirmed economic data would consistently buy after the recovery and sell after the decline, which is the opposite of the intention.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Market Cycle” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.