Bear vs. Bull Market: When is the best time to invest in crypto?
Updated: Jun 30, 2022
Like the stock market, cryptocurrency markets can be described as either a bear or a bull market. To put it simply, a bull market is a rising market, where asset prices increase and investors are optimistic. In contrast, a bear market is a declining market, where asset prices fall, and investor sentiments are gloomy.
As an investor, it’s crucial to understand these market cycles. A firm grasp of bears and bulls let you take advantage of market conditions, whether they’re on a climb or a dip.
What is a Bull Market?
A bull market is characterized by long, sustained increases in market prices or a quick but substantial (around 20%) upward swing. It got its name from the mighty bull, who attacks with upward motions of its horns.
In a bull market:
Investors are optimistic. Market confidence is high. Confident investors, known as bulls, eagerly buy assets.
Demand is greater supply. As demand exceeds supply, prices rise steadily.
A feedback loop. And as crypto prices rise, the market inspires even greater confidence and draws even more investment. More people buy, demand rises even more, and so do prices.