What Is Bull Market?
Also known as: Bullish Market, Uptrend Market
In short
A bull market is a period in which the prices of an asset or the overall market rise for a long time, with investor confidence and optimistic expectations prevailing. In traditional markets, a rise of 20 percent or more from the bottom is generally considered the start of this period.
The term is likened to a bull swinging its horns upward as it attacks. In bull markets, trading volume increases, new investors enter the market, media interest intensifies and new projects find funding more easily. In the crypto market, 2017 and 2020-2021 are distinct examples of bull markets. Although in the past these rallies have often occurred in the periods following Bitcoin halvings, there is no guarantee this relationship will repeat.
Sharp corrections can occur while a bull market continues; pullbacks of 20-30 percent are normal in the crypto market. In the later stages of rallies, FOMO, excessive leverage use and heavy interest in speculative assets increase. Sentiment indicators such as the Fear and Greed Index generally rise into the extreme greed zone in these periods.
When a bull market began and when it ended is often understood only in hindsight. Excessive risks taken on the belief that the rally will continue can lead to major losses when the trend turns. The opposite of a bull market is a bear market, in which prices fall for a long time.
Last updated: · This content is for information purposes only and is not investment advice.