Here's where history says the latest bull market is headed next

• The current bull market in stocks is more of the slow-and-steady variety than the high-octane type, according to DataTrek.
• The research firm compared the current rally in stocks to prior bull markets, and the results suggest sluggish gains ahead.
• "If that analog continues, the [S&P 500] may be mostly flat over the next three months until it anniversaries its October 2022 low."

The stock market's current bull rally is likely to be of the slow-and-steady variety if history is a guide, and that means sluggish gains ahead, according to a Wednesday note from DataTrek Research.

The research firm compared the current stock market surge to four prior bull market cycles that began in 1990, 2002, 2009, and 2020, and found that there are two types of rallies.

One type is a high-octane rally, like was seen in the 2009 and 2020 bull markets when the S&P 500 surged more than 60% after 185 trading days from its bottom.

The other type is slow-and-steady, like was seen in the 1990 and 2002 bull markets when the S&P  500 jumped about 30% after 185 trading days from its bottom.

With the S&P 500 having bottomed in mid-October, or 185 trading days ago, it has since rallied 24%, putting it in the slow-and-steady category, according to DataTrek co-founder Jessica Rabe.

"If that analog continues, the index may be mostly flat over the next three months until it anniversaries its October 2022 low. The S&P only gained 1.3% over the next 66 trading days from today when taking the average of our 1990 - 1991 and 2002 - 2003 comparisons," Rabe explained.

It's a similar story for the Nasdaq Composite, which is up about 35% since its bear market low. Rabe highlighted that the gain is closer to the 1990 and 2002 bull markets than the 2009 and 2020 bull markets, which saw gains of more than 60% this far removed from the bottom.

If the Nasdaq follows the same pattern of the 1990 and 2002 bull markets, as it has so far, it could see gains of about 8% over the next three months and gains of 18% over the next six months. 

But there is one catalyst that could shake the current slow-paced bull market into a faster-paced, higher-octane type of rally, and that's the Federal Reserve changing its stance on interest rates, according to the note.

"The slower pace of the current rallies in the S&P and Nasdaq Comp off their 2022 lows relative to history is unlikely to change until the Fed shifts its current hawkish stance on rates," Rabe said. "While we remain positive on US stocks for the second half, the work we have presented here says markets are in 'slow rally' mode."