Rising and falling markets (bull and bear markets)

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Rising and falling markets (bull and bear markets)

The two terms of bull market and bear market in stock exchanges and markets It is heard continuously. Today, because the investors' inclinations determine the market situation Therefore, these terms are also used for investors How does the investor feel about the market and what is he looking for? Simply put, A rising market is a market in which the price of securities is increasing and its characteristic A continuous increase in the market share price. In such cases, investors believe that This growing trend will continue for a long time.

On the other hand, the market is a bear market that the price of its securities is decreasing and falling. The stock price is constantly falling As a result of this reduction, investors think that this process will continue for a long time The market will be more bearish every day than yesterday. These terms according to the states of these two animals (cow and bear) has been selected. The cow is usually aggressive and on the move, but the bear is rare It is active and lazy. The conditions of bullish and bearish markets are determined based on the expected trend of the stock price But it can be clearly said that in the rising market, the demand for securities is very high and the supply is high is weak In other words, many investors want to buy securities

While few people are willing to sell their financial assets, as a result, based on

The constant law of supply and demand increases the price of securities because the buyers of these securities Getting the right investment, they start to compete with others.

In a declining market, the opposite of this happens. This means that the previous investors are now strongly inclined to offer and sell their financial assets. Naturally, the demand is also decreasing and the market It experiences a continuous decrease in the price of bonds. Since the behavior of the market is affected by the behavior of the people acting in it, psychology and measuring the psychological atmosphere, based on positive or negative expectations about the fall or rise of the market It is important.

The performance of the stock market is correlated with the psychological atmosphere of the market. In the rising market, almost everyone is in the market They are interested and participate in it with the hope of making a profit.

In a bear market, market sentiment is negative as investors begin to They don't withdraw their capital and buy stocks and wait for fixed income securities until there is a positive movement in the market that shows the horizon of investment to give In general, a decrease in investor confidence in the market causes investors to lose their money take them out of the market, which in turn leads to a drop in the stock market.