Trading Paradigm

Train and Develop Professional-Level Trading Skills

  • ARTICLES
  • TOP RATED
    • Training & Mentorship
      • Tradacc Profile Method
      • TradeWithProfile Pathway
    • Funded Trader Program
      • Topstep Futures
    • Brokerage Platform
      • Edge Clear
  • FREE RESOURCES
    • Futures Trading
    • Active Trading (General)
  • FAQ
  • TRADING TRUTHS
    • The Fantasy Gap
    • Proper Expectations
    • Knowledge vs. Skills
    • Trading vs. Gambling
    • Entertainment vs. Training
  • TRADER PSYCHOLOGY
    • Natural Biases
    • The Mirror Concept
    • Self-Transformation
    • Failure is Feedback
    • More Mindset Articles
  • MARKET EDGE
    • Volume Profile
    • Expected Value Formula
    • Asymmetric Risk-Reward
    • Trade Tracking & Review
    • More Edge Articles
  • SOCIAL MEDIA
    • Twitter
    • YouTube
    • LinkTree
  • ABOUT
  • FREE FRAMEWORK COURSE & INTERACTIVE COMMUNITY → BECOME A CONSISTENTLY PROFITABLE TRADER

What is a Bear Market?

December 28, 2018 By Matt Thomas Leave a Comment


A Bear Market is characterized by securities prices falling, anticipation of losses, and widespread pessimism. The typical causes of such pessimism is a weak or slowing economy, high unemployment rate, limited disposable income, reduced business profits, and/or tax rate changes. Overall, there is a major drop in investor confidence for one reason or another. A 20% drop from a peak in one or multiple broad market indexes (S&P 500, DJIA, NASDAQ, etc.) over a 2-month period of time or longer is generally considered entry into bear market territory. Less drastic drops within shorter periods of time are known simply as Corrections.

The opposite of a bear market is a Bull Market, characterized by rising securities prices and optimism. The bulls and bears are metaphors selected by how they attack their prey. Bulls thrust their horns upward, while bears swipe their paws downward. Bull markets tend to last for months and even years. The major US market indexes have seemingly been on a steady uptrend since the low point of the financial crisis in 2009. Recently, many of the top broad market indexes entered into bear market territory. The S&P 500, for example, was down nearly 3% on Monday 12/24, for a total drop of over 20% from its peak in September. That, however, was immediately followed up by a 4.9% gain on 12/26, which is one of the largest one-day moves ever for the index. Only time will tell if this bullish reversal will sustain or if markets will dip lower into bear market territory.

Related Post: What is an Index Fund?

Filed Under: The Daily Dose: Questions For Stock Traders

STOP TRADING BLIND. START USING THIS PROFESSIONAL TRADING TOOL.

SEARCH

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

STOP TRADING BLIND. START USING THIS PROFESSIONAL TRADING TOOL.

SEARCH

#1 Free Foundational Course

Trading Success Framework - Free Course

Overall Rating – 4.9/5 Stars

Get Started on the Right Path

#1 Trading Psychology Course

2ndSkies Trading With Chris Capre

Overall Rating – 4.8/5 Stars

Overcome Your Current Conditioning

#1 Training/Mentorship Program

Trade With Profile - Top Rated Active Trader Training Program

Overall Rating – 4.9/5 Stars

Acquire X-Ray Market Vision

#1 Funded Trader Program

Topstep Trader - Top Funded Futures Trading Program

Overall Rating – 4.8/5 Stars

Earn 5, 6, or 7-Figure Funding

#1 Training/Mentorship Program

What is Tradacc.com - Tradacc Reviews - How is Tradacc For Beginners

Overall Rating – 4.9/5 Stars

Accelerate Your Trading Journey

#1 Futures Brokerage Service

What is EdgeClear - Is it the Best Broker to Trade Futures With?

Overall Rating – 4.9/5 Stars

Learn More About EdgeClear/EdgeProX

Risk Disclaimer||Affiliate Disclosure||Privacy Policy||Site Map||Contact||About