With the markets tanking, many wise investors are wondering when and where will the bottom be put in so that they can return to investing.

Before I give my forecast, let me start by saying that from a technical standpoint, we’ve seen these downard signals, levels and patterns reached before, just never this quickly.

S&P 500 Bottom Forecast

There is so much information in this chart that I actually feel comfortable forecasting a bottom in this market. However, this forecast assumes that the 800 price level holds (which I believe it will).

The previous bear market started in March of 2000, and bottomed in November 2002, almost 31 months. The current bear started in November of 07, meaning we are now 11 months into the current bear. Since these markets are very similar, it could be forecasted that the bottom should come in around June of 2010.

However, while the patterns of these markets are very similar, the actual slope of the decent during this bear is much steeper. How much so? 150%. Using this data, the bottom could be forecasted at around 20 – 21 months, or, somewhere between August and September, 2009.

There is one more possibility I’d like to consider. Over the past 2 months, the rate of decline has increased significantly. I believe that momentum will actually shave some addition time off the race for the bottom, and, you read it here first, I belive the market will bottom in May, 2009.

I’m working on a video to explain all of this. Stay Tuned.

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