A bear market is where people take temporary, short positions in a company, and sell when they think the company is doomed. It is a more pessimistic market, and prices go down. A bull market, on the other hand, is the opposite of a bear market. Buyers invest in a company they think is going to rise, and keep investing in it, hoping for future profit. In a bull market, prices trend up instead of down. Basically, bulls are buyers, bears are sellers.
Bear markets occur when recessions happen, and unemployment rises. They make it difficult to choose stocks since everything is going down.
Bull markets occur when the economy is running well(unemployment low). When the Bull market goes too far, it is called a bubble.
This information provides one with a deeper understanding of the stock market and how it works. Personally, I’ve been doing bear market type stuff this whole time. I just buy something and sell it quickly. With this information, I can better understand which strategies I could use. It gives me a new way to look at the stock market. What I might do now is try something more like a bull market. Instead of just investing into things for a day or two, I could try to find something that I think will trend upwards and keep investing into it as it rises. Or, I could sell something when I think it’s going down, and buy it again later for a lower price. It helps me understand what kind of strategies to use, and which situations to use them in.