This is a lesson that many investors have been taught before, but so many investors have a difficult time following: do not chase after a bear market rally. In the past three days the Dow has gained over 550 points and has risen back above 7,000. Many on Wall Street are now asking whether this is a real sign of the bottom or if this is simply another suckers rally like several others have been in the last few months.

The main lesson that everyone should understand is that in a market that has an economic backdrop like we have right now there simply is no reason whatsoever to chase stocks higher in the hopes that this is the beginning of a huge move.  The simple fact of the matter is even in a brutal bear market there are going to be some violent swings higher because no market is going to go in a straight line in either direction. In fact, bear market rallies are typically much quicker, but also more short-lived than bull market rallies.

With an economy that is bleeding jobs and consumers losing trust in the overall system there is no reason to believe this is the start of a strong bull market. I am not saying that the bear market isn’t getting close to over, for that is much harder to determine, but rather I am simply stating that any bull market that would come in the future will be very slow to develop because of the slow economic recovery.

Don’t feel the need to chase your favorite stocks higher during these bear market rallies. The stocks will have big up days and big down days, and it is up to you to make sure you buy them at the right time.