Bull markets and bear markets represent the ebb and flow of the crypto industry. This guide will explain what bull and bear markets are and what strategies traders use during each.
For all types of markets, a substantial price swing in one direction or the other of at least 20% within 6 months or longer generally signals a bear or bull market. Indicators of bull markets are often a set of higher highs and higher lows. With bear markets, an indicator would be a series of lower highs and lower lows.
The general characteristics of bull and bear markets are as follows:
Bear Markets:
Bull Markets:
You may see a bear market during one year but if you zoom out to 5 or 10 years, it may be a bull market overall. One example would be the NASDAQ stock exchange, which crashed with most global markets at the height of Covid-19. But if you zoom out, you can see that despite the 2020 bear market, the NASDAQ has actually been uptrending since 2009.
No matter whether it’s a bear or bull market, there are strategies available to investors, including:
Markets tend to be impacted by how investors perceive or react to current market behavior, so investor psychology and sentiment can also affect future market prices and price swings.
This type of market psychology can sometimes cause people to act against their own interests. For instance, during a bear market prices are low and it can be a good time to accumulate, even though the market sentiment is low. Conversely, during the height of a bull market prices are high, making it potentially more difficult to make a profit if you buy.
Learn more about the 4 main Market Cycles that repeat in crypto markets.
During bear markets, traders have multiple ways to ride out the downtrend:
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Traders in a bull market generally look for ways to track momentum, find early entry points, and automate profit taking.
In the world of crypto, bear markets signify low market sentiment but may offer a good chance for coin accumulation. Bull markets are often riddled with FUD and FOMO and may offer a good time to sell or buy the dips if the timing is right.
For all types of markets, a substantial price swing in one direction or the other of at least 20% within 6 months or longer generally signals a bear or bull market. Indicators of bull markets are often a set of higher highs and higher lows. With bear markets, an indicator would be a series of lower highs and lower lows.
The general characteristics of bull and bear markets are as follows:
Bear Markets:
Bull Markets:
You may see a bear market during one year but if you zoom out to 5 or 10 years, it may be a bull market overall. One example would be the NASDAQ stock exchange, which crashed with most global markets at the height of Covid-19. But if you zoom out, you can see that despite the 2020 bear market, the NASDAQ has actually been uptrending since 2009.
No matter whether it’s a bear or bull market, there are strategies available to investors, including:
Markets tend to be impacted by how investors perceive or react to current market behavior, so investor psychology and sentiment can also affect future market prices and price swings.
This type of market psychology can sometimes cause people to act against their own interests. For instance, during a bear market prices are low and it can be a good time to accumulate, even though the market sentiment is low. Conversely, during the height of a bull market prices are high, making it potentially more difficult to make a profit if you buy.
Learn more about the 4 main Market Cycles that repeat in crypto markets.
During bear markets, traders have multiple ways to ride out the downtrend:
Diversify by staking coins at Quadency!
Traders in a bull market generally look for ways to track momentum, find early entry points, and automate profit taking.
In the world of crypto, bear markets signify low market sentiment but may offer a good chance for coin accumulation. Bull markets are often riddled with FUD and FOMO and may offer a good time to sell or buy the dips if the timing is right.
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Quadency is a cryptocurrency portfolio management platform that aggregates digital asset exchanges into one easy-to-use interface for traders and investors of all skill levels. Users access simplified automated bot strategies and a 360 portfolio view with a free account.
Disclaimer: The content of this article is for general market education and commentary and is not intended to serve as financial, investment, or any other type of advice.
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