Understanding Bull vs Bear Market In Crypto Trading: A guide for beginner

What do bull market run means in crypto?
As investors become more confident in cryptocurrency or blockchain technology, prices steadily increase over time during a bullish market. Both novice and experienced traders show interest in new coins and tokens in markets like this one, making them popular. During a bullish market environment, institutions typically join in too, thereby adding to the increasing demand for cryptocurrencies.

---

Source

---

What the term Bullish means in crypto?
When it comes to cryptocurrency investing world, the term "bullish" refers to positive investor sentiment toward digital assets, and such investors are commonly referred to as "bulls". As the market's momentum continues to build, bullish investors usually build on their existing positions. When confidence is high and infectious, a bull market can continue to rise.

Signs of a bull market
A crypto bull market can be distinguished by various defining factors such as;

• Asset demand is steadily increasing.

• Market upswings are being reported in the media more frequently.

• Confidence levels among investors are high.

• Markets are flooded with new investors.

• Good news will further skyrocket prices sharply upward.

What actually causes a bull markets run?
The profit earned from the rising price of an asset or assets due to investor optimism is what primarily leads to a bull market. On the other hand, there are numerous other factors involved here. Some of them originate from within while some stem from outside and an example of this would be a solid economy with low unemployment and consistent GDP growth that paves the way for a bull market. The causes of a crypto bull market differ somewhat because it is viewed as a newer asset class that stands apart from traditional investments, and a well known phenomenon is the impact of celebrities tweeting about different crypto projects they are backing on the occurrence of bull runs.

Investing strategies during a bull markets
It is unlikely that we will have another year like 2021 in the near future when it was fairly easy to make money by selecting random investable assets, even so there will undoubtedly be more bull markets in our future. These are some effective approaches to fully capitalize on the situation;

• The greatest chance to earn ROI comes from buying early in the run.

• Implement a stop loss order as a means of protecting your earnings. To prevent triggering the order too early, be sure to leave ample buffer to withstand temporary price spikes.

• Stay alert, don't invest assuming the gravy train will never end because no bull run is permanent.

• Consider taking profits if the market starts to trend bearish.

What bear market means in crypto?
Fear is a common sentiment among investors in a crypto bear market, with low confidence comes a decrease in both prices and demand. A bear market is generally disliked by everyone but it does bring buying opportunities once the dust settles. Once prices have reached their lowest level and stabilized again, investors become interested once more in acquiring assets that they now see as undervalued. Following each considerable decrease in the crypto market's value recently there has always been a significant increase.

What Bearish means in crypto?
With a bearish sentiment prevailing in crypto investing, it doesn't just mean that newbies and paper hands have vanished but even die hard HODLers are facing some anxiety. Moreover, investor confidence typically dwindles in a bear market causing feelings of negativity towards asset prices. During a downturn in the market cycle coins or projects that used to be popular can become deserted virtual ghost towns.

Signs of a bear market
During a period of decline in cryptocurrency values,(just like we’re currently witnessing since 2022 till date) you can expect to see one or more of these;

• Prices dropping over a prolonged period

• Demand for assets falling

• Low investor confidence

• Bad news sends prices spiraling downwards

• Good news does little to stop the bleeding.

What causes a bear markets?
The legal tender during a bear market is fear whereas during a bull market it's optimism. Bear markets can be initiated by different factors such as wars or regulatory announcements (just like the ongoing SEC issues with Binance, Coinbase). Hype plays a crucial role in driving the cycles of the crypto market, consequently when bad news or negative sentiment begin to gather pace it results in an escalating impact that swiftly brings down prices.

Investing strategies in bear market
Although there are risks associated with bear market investing Investors have different strategies they leverage when investing in a bear market such as;

• To protect yourself from market volatility during this turbulent period, consider moving your holdings into safer crypto assets like stablecoins.

• If there are clear indicators of an impending market decline, you should consider selling your holdings with the intention of buying them back at a discounted price in the future.

• Stay determined and refrain from examining your portfolio until market conditions improve.

In conclusion
Attempting to forecast the beginning or end of a bull or bear market is usually an exercise in futility, making market timing nearly always a fool’s errand. That’s particularly accurate in the field of cryptocurrency, where prices of assets are more susceptible to significant fluctuations in both upward and downward directions within brief time frames. Bull and bear markets being a fact of nature is true when it comes to investing. Early recognition of them can assist in reducing the discomfort when the bears are leading. A tidy profit can be achieved by making appropriate moves when the bulls run things.