Secrets To Bull Markets
The terminology Bull market and bear markets are generally used to describe the direction of the market either up or down. Stock prices up and down both during a trading day, and from one day to the next. But terms such as bull and bear describe the trend over the long term. Many analysts use a minimum analysis period of two years to determine if a change is a trend or just a change. They also feel the market needs to move at least 20%.
A bull market describes a market where prices are generally on the increase. A bull market often starts when market confidence is at its lowest. At this time investor confidence starts to increase and there is an expectation gains will be made on rising stock prices. This is happening now in the gold stocks market.
A bear market on the other hand is one where there is a constant decline in stock prices.
One of the most memorable bear markets in recent history followed the stock market crash of 1929. In the three years that followed nearly 90% of stock values were wiped out. But obviously things did improve.
There is a recognised pattern to bear markets that a large initial decline is followed by a short term temporary correction in prices. Many investors trade at this time an are burnt when the next wave happens and there is a sustained decrease in stock prices.
But with any cycle after the decreases of the bear market come the rises of the bull market. It is well known that to make money on stocks you try to buy low and sell high. However no one knows where a market will head and knowing when to buy or sell is not easy.
For many people the idea that markets have cycle is forgotten. One can make money in both a bear and a bull market.
Article Source: FxTradingStock.com
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by: Mike Swanson
Total views: 97
Word Count: 329
Date: Sun, 6 Sep 2009
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