The Market and it phases. [Part 2]
So where did we stop guys...smiles. I just can't wait to take us on another ride, pardon my manners guys. I trust we are all good today. I want to believe we got value from the last post. Well, am here to take us deeper into the subject we are already looking at; Bear market.
We have been able to define what the market is and the set of investors referred to as the Bears. We were also able to answer some vital questions about the bear market.
Today I deemed it fit to add yet some interesting stuffs to it like how long can a bear season last, types of bear market and characteristic of a bear market... Shall we? I believe it's a yes! Smiles...let's get in
According to my findings, there are typically two kinds of bear market. Interesting right? Well I've never knew we had two until I made my findings as well. This is the essence of DYOR, it broadens one's knowledge about one's topic of interest.
We have the Cyclical Bear Market and the Secular Bear market..
Now the Cyclical Bear market can be referred to as the regular bear market we experience time and time again. Its a short term bear market that lingers for month before the market take a bounce back in the bullish direction. It is usually for a short period of time.
While the Secular Bear market is the kind that lingers for years. It a long term bear market that makes the market depressed for a very long time. It can persist for as long as a decade or more even though it allows for rally which serves as correction to the already declining market. It's not always sufficient to change the fallen state of the market.
The different market phase we have in the market, which are basically the bull and bear market have their duration. None is expected to last forever and both phases occur in the market to bring balance to it.
The Bear market have a shorter timeframe when compare to the bull market.
According to my findings, the bear market lingers for few months, to few years. I.e 349 days while the bull market can span as long as 1,742 days. The only period where we can have abnormally in duration for the bear market is when a secular bear market hits the market. It can span as long as 10 - 20 years. It's a long term trend.
- Demand falls
The reason is not far fetched, every investor seem to be reacting in a way they deem fit, only few investors are willing to HODL, majority subscribe to the sell option, meaning more supply and low demand. There are more sellers in that season than buyers.
So there is less demand for asset. Maybe as time goes on people then start thinking back like investors by going in again to buy dips and that is if they will be patient enough to hold until the greens begin to ravage the market.
- Investors Lack confidence
This is the natural default state of investors in the face of a bear market. They literally lost all the confidence and optimism they've got. The action that follows is that they begin to pull out because of fear/panic
- A rise in short selling
Like I mentioned in the first point, many investors begin to sell off massively becase of fear. It's actually not easy to watch your investment depreciate before your very eyes, so to minimize the loss, many subscribe to selling off and the result of this sell is that the price of these asset begins to further fall, leaving the value worse
- Decline in IPO's
Don't forget that we mentioned when we treated the characteristics of the bull market that it breeds the entry of many IPO/ICO. Many companies with nice project cease the advantage of the season to lure investors into buying into their project.
For bear market, the reverse is the case. The market is already depressed, the season is actually not the best bet for a new or emerging project to come on board. The project might sink and fail woefully. In a nutshell, the bear market discourages Initial Public Offering of coin or assets.
Better days are indeed ahead. We are just some step away into the massive greens and am optimistic about it...I hope you're too. Let also do well to position ourselves to get the best out of this season we are steadily approaching.
There you go friends.I would love to wrap it up at this point. I want to believe you've gotten so much from this piece. As my usual custom is, I would always encourage that you DYOR to be sure of every financial step you would want to take as I won't be liable for any form of loss encountered by you.
Feel free to share with me your thoughts in the comment section. Thanks for your time once again. Gracias!
Disclaimer: This post is made as an education and not investment advice. Digital asset prices are subject to change. All forms of crypto investment have a high risk. I am not a financial advisor, before jumping to any conclusions in this matter please do your own research and consult a financial advisor.
Regards
@lhorgic♥️
https://x.com/lhorgic1/status/1727310935235182871?s=20
It's very strange that your twitter tag is also spelled wrong. It means you even don't check when sharing tweets. Very disappointing.
Dear admin @nusuranur, sorry about the error detected...Mistakes are bound to happen, none is perfect, we would once in a while experience "oversight" of things around us. My apologies.