The consumer staples and consumer discretionary sectors, for example, can serve as bellwethers for the direction of the overall market. When consumer confidence and spending are high, indicating a strong economy, that often translates to stocks in the consumer discretionary sector performing well. But when that sector lags and consumer staples outperform, it can be indicative of a late-stage bull market. Historically, bull markets tend to last longer and be more powerful than bear markets. Since the dawn of the U.S. stock market, prices trend up over time.
But in 2022, tech’s 28.2% loss saw it finish third-worst, one spot above consumer discretionary, while communication services finished last with a loss of 39.9%. These often include long-standing organizations in sectors that are well-equipped to endure various market cycles and economic disruptions. Historically, they have fallen into a handful of the S&P 500’s 11 sectors, which tend to outperform during elevated volatility and prolonged bearishness.
Buying opportunities
It’s always a good idea to consult with a financial advisor or do extensive research before making any investment decisions, especially how much can i make with $100 in forex in a volatile market. In the financial world, experts need to see two months’ worth of data to declare a market bullish or bearish. A bull market, typically referencing stock indices, exists when prices are on the rise.
Bullish vs. bearish meaning in the stock market
A bear market exists in an economy that is receding and where most stocks are declining in value. Because investors’ attitudes greatly influence the financial markets, these terms also denote more money than god how investors feel about the market and the ensuing economic trends. “These last several years saw the strongest bull market in decades,” you might have heard some talking head say at some point. We’re sure plenty of people have zero clue what a “bear market” and “bull market” even are, let alone where the terms came from. They’re probably too busy buying groceries to mess around with our international gambling cartel, i.e., the stock market. The origins of the terms are even more unclear than whatever wizardry happens on the stock market floor.
Bullish vs. Bearish Candlestick Patterns
The key to making money in the market is to be on the side of the more powerful force. When the bulls have the upper hand, I stay on the long side. When the bears have the upper hand, I watch for a hot sector.
Strategies
Personally, I think the market was long overdue for a correction after over 10 years of a bull market. But I’m still prepared to trade through it — and to teach you how too. Access my no-cost, two-hour “Volatility Survival Guide” to learn how to ride the wild momentum.
If we look up the Oxford Learner’s Dictionary, bullish is described as “to cause, or be related to a rise in prices”. Bearish on the other hand means “to show or expect a fall in prices”. This is because of the way both animals attack their prey. Bulls attack with their horns in an upward fashion while bears descend using their body weight.
On March 30, 2025, as of this writing, the Crypto Fear and Greed Index stood at 32 (Fear), up from 17 (Extreme Fear) earlier in the month. While such indices don’t predict price movements, they often reflect broader shifts in investor thinking. When fear consumes the market, remaining disciplined and not reacting impulsively is paramount, according to Tim Thomas, chief investment officer and wealth manager at Badgley Phelps.
Erika Rasure is globally-recognized as a leading consumer economics subject matter expert, researcher, and educator. She is a financial therapist and transformational coach, with a special interest in helping women learn how to invest. That’s potentially what happened Tuesday, with the S&P 500 surging 4% after its brutal three-day sell-off. “On that basis, we would expect further downside,” Goldman Sachs said. “Very low unemployment (which is likely to rise) and elevated valuation suggests that markets are still vulnerable to the downside.”
If the S&P 500 closes down 20% from its peak and officially triggers a bear market, there could be more pain ahead. Furthermore, Goldman said that an event-driven bear market could easily turn into a cyclical bear market if the economy materially slows down. Betting markets and various economists now predict the odds of a recession hitting the US economy this year have risen past 50%.
This drastic price drop occurred due to several reasons, including drying up of investment capital, large sell orders and panic selling. The late 1990s’ widespread growth of technology companies that’s known as the dotcom bubble is an example of a major bull market. It was primarily fuelled by rapid advancements in internet-based companies. Meanwhile, the value of the NASDAQ 100 shot up by over 1,000%. People have more money to spend and are willing to spend it.
- The investing strategy of dollar-cost averaging helps to smooth out the high and low prices of a stock.
- There was also one amid the COVID-19 pandemic in 2020 as U.S. indexes dove at record speed into bear markets due to the ensuing global shutdown.
- Bullish investors tend to have the patience to allow downward resistance to eat into returns in hopes of actualizing substantial returns in the long run.
What is a bear market vs. a bull market?
- The below chart of the US 500 shows the index’s performance during the Covid-19 crash and the subsequent bull market.
- You can be bullish or bearish a market, stock, or indicator.
- The origins of the terms are even more unclear than whatever wizardry happens on the stock market floor.
Using the S&P 500 as a benchmark, since 1942, the average bull market lasted 4.2 years while the average bear market lasted 11.1 months. The average cumulative return of the bull markets was 148.9% and the average cumulative loss of the bear markets was -31.7%. Since 1942, there have been a total of 16 bull markets and 15 bear markets. The period assessed is from April 29, 1942, to March 28, 2024.
As a trader, you may agree with forex etoro review this sentiment and become bullish on stocks with the anticipation of a specific company’s shares rising or a stock index going up. Both bear and bull markets will have a large influence on your investments, so it’s a good idea to take some time to determine what the market is doing when making an investment decision. Remember that over the long term, the stock market has always posted a positive return. The 1929 stock market crash ushered in the longest bear market at more than 32 months.