The market exodus has begun. But for true capitulation, watch for 'investors selling what they love,' says BofA.

• A market exodus has begun but the lows haven't been reached yet, Bank of America said in a report
• "Are We There Yet? No…fear & loathing suggest stocks prone to imminent bear market rally but we do not think ultimate lows have been reached..."

The recent market rout signals an investor exodus has begun, but a true bottom hasn't been reached yet, Bank of America strategists wrote in a note Thursday.

The report by BofA's Michael Hartnett with Shirley Wu and Myung Jee-Jung said the collapse in crypto and speculative tech stocks now rivals declines seen during the dot-com bust and the global financial crisis. Overall, weekly outflows were seen in stocks, bonds, gold and cash.

But that doesn't mean capitulation — an indicator of a market bottom that some traders use as a sign that a rebound will begin — has arrived.

"Are We There Yet? No…fear & loathing suggest stocks prone to imminent bear market rally but we do not think ultimate lows have been reached, nor ultimate highs in yields," BofA wrote, pointing out that current conditions haven't fully met its capitulation checklist.

For now, capitulation has progressed much further in the credit market than in stocks, adding that "risk-on will appear first in bonds not stocks," the analysts said.

They argue that actual capitulation won't be apparent until the market sees "investors selling what they love."

One place to look may be Apple, which was a bull market darling but is in the midst of a bear market that follows a broader selloff trend.

Still, despite coming well off its high, the stock has yet to breach its 100-day moving average of $137, BofA said. Apple shares fell as low as $138.84 on Thursday but rebounded to $147 on Friday.