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What is a bullish trend? Discover here.
If you are interested in crypto-currency, you might wonder about the factors that determine investors’ and traders’ profits. They are bull and bear markets for sure. Successful hitting a bullish trend can increase your starting capital several times in a few months, and an unsuccessful entry at the beginning of a bearish trend means noticeable losses. In this article, we will give you an answer about what a bull market is and tell you about all its features you should know. First of all, both these terms came into the crypto-currency market from traditional financial markets and stock exchanges.
General information about a bull market
Many people and crypto-enthusiasts wonder about the origin of the bull trend name and there is a quite curious theory: the bull lifts his prey on his horns, while the bear presses down toward the ground. This could also help you to get a better understanding of both these phenomena. Accordingly, a bullish trend marks the general upward movement of the market, while a bearish trend marks the collapse of prices. Moreover, both bullish and bearish trends are characterized by greater duration than pumps, price surges, and drops, as the whole market tends to move in one direction for a while.
Bitcoin: how it was
For example, when Bitcoin was launched in 2009, investors were still skeptical about its future given that it was a new thing. It however experienced an increase in its prices, in 2017 which is its most recent bull market illustration. In that year, the prices of cryptocurrency increased drastically. As a result of that, people started talking about cryptocurrency. Investors did not want to be left behind and everyone was optimistic about its future. Notably, Bitcoin rose from $0.10 in 2010 to $20.000, in 2017.Crypto-currency investments are quite risky. To minimize the possible losses, you should be well prepared and not invest money that you are not ready to lose. As digital assets such as crypto-currencies are still in their early stages of development, it is not the best option for those who are not ready to take risks as the crypto-currency industry is highly volatile. Besides, the topic of technical analysis of crypto-currency rates has recently become especially popular among crypto-enthusiasts. The crypto-currency and common users try to determine when the bull trend starts and ends to make the best profit while trading.
The main advantage of using trend trading techniques is that sometimes trends can last much longer than many traders expect. A bull market and bullish trend is a situation in the crypto-currency market when the value of an asset keeps increasing. In this case, the number of buyers exceeds the number of sellers. Accordingly, “bulls” are traders who gain profit as a result of an increase in the price of the asset, and “bears” are traders who profit when the value of an asset is falling.
Difference between market and trend
Furthermore, there is also another important point to understand that the “trend” and the “market” are not the same things. A trend, as mentioned above, is a general tendency of price changes. And a “bull market” is a market where buying crypto-currency prevails overselling. Thus, the increased demand for the asset raises the price upwards and creates a trend. If the trader manages to get into this trend, he will have a chance to buy the asset much cheaper than it will cost later. After that, the trader has to catch the right moment when to sell all the assets, which would probably create some difficulties for newbies.
However, bullish trading is one of the most time-tested and potentially profitable approaches when traders follow the crowd, analyzing the market. Then, a trader can often determine a major trend for the crypto-currency using the trend trading method and/or combining more than one method of analysis. Traders who rely on bear trends should remember that not every new trend will trigger a large price movement. Frequent short-term reversals will occur for sure and can be confusing.