Is it time to buy exchange traded funds (ETFs), or is it time to sell them? Is it a bear market gnashing its teeth at us, or a new bull market waiting to charge ahead?

Evidently, the gap between the two schools of investment thought – bulls or bears – is widening. The bulls were elated to see the biggest rally this month since the meltdown, and finally, after a 401(k)-busting, 7,722-point plunge in the Dow Jones Industrial Average, the stock market seemed to be escaping bear territory, writes Jack Healy for The Wall Street Journal.

Many investors are hopeful that that market may be nearing a bottom, with proof in the quick sale of technology and oil shares, as well as financials. Stocks are cheap right now to some, as the price-to-earnings ratio on the S&P 500 is 12 to 13, lower than its historical average of closer to 17.

Bears argue that the rallies occur, but they also fizzle out. Even on Monday, the pullback was enough to validate a bear, as Morgan Stanley was advising investors to start selling again to lock in their recent profits, and it continued its drop as investors wondered about the management change at General Motors.

There is much more time that must pass before either side can be right. The uncertainty over the future of the banks, the automakers, the housing market and the economy at large is huge. Even optimistic investors warn that a recovery in stocks will not look like a steady climb, and they say that economic growth may be slow for some time.

When looking for investment opportunities in the market, watch the trend lines to see where potential long-term uptrends are gearing up.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.