As in any sphere of activity, investing has its specific terminology. For example, novice investors and traders repeatedly encounter “bull” and “bear” expressions in their analysis and forecasts of asset price behavior. It is essential for a beginner as well as an experienced trader to understand what these terms mean, how to define both types of markets and how to profit from them.
“Bulls” and “bears” refer to stock market participants metaphorically. Next, let’s break down in more detail what they mean.
Who are the bulls and bears at the stock exchange?
Bulls are traders and investors who make money on rising prices. They buy up assets and swap crypto coins because they believe that the market, sector, or specific stock will go up in price.
Bears – market participants who are sure that the market will fall. They sell securities or open short positions if they expect a collapse. According to the Library of Congress, the first mention of these terms dates back to 1714.
Bull and bear market
When there are more buyers than sellers, the market grows and is called a bull market. With their purchases, market participants “push” the price up, just as a bull tosses his prey up with his horns.
The price begins to fall when there are more sellers than buyers on the market. Bears are pushing prices down like a bear holding its prey close to the ground. A falling market is called a bear market.
Where Does Private Stock Fit Into Things
The whole bull and bear situation is an interesting one but it can be frustrating for people who just want to see a specific stock do well for a company that they’ve researched and invested in. Private stock isn’t susceptible to the bull and bear movement because they aren’t listed on the stock exchange.
Some fascinating stocks are only available on a private basis; by ignoring them, you could be missing out on a pre-IPO investment opportunity. Take Docker, for example. Interestingly, Docker has yet to file for an IPO.
After selling its enterprise business in 2019 and changing CEOs two times, the company seems to be back on its feet. Investors are still interested in docker stock on a private basis even though an IPO hasn’t been officially endorsed. The current CEO, Scott Johnson, has taken the business through two new funding rounds attracting more than $120 million with a company valuation of $22 Billion.
It’s an attractive option for private stock investors that want to see the value of their stock go up through the business doing good work rather than the actions of bulls and bears in the public stock market.
Who is stronger: bulls or bears?
The stock market reflects what is happening in the economy. For centuries the world economy was developing, new companies and technologies were appearing, and new markets were opening. Therefore, even in spite of military conflicts and crises, in the long run the markets grow, i.e. they are bullish. Bears take over the initiative only for a while.
It is easier for bulls to make money. By investing in solid assets, like blue-chip stocks, they are more likely to profit in the long run. The main thing is not to be afraid of bears and calmly wait for a correction.
A bearish trend in the cryptocurrency market
Now that you know the difference between these periods, you can easily determine that now the cryptocurrency market is in a bearish trend. Clear proof of this thesis can be seen in the price of Bitcoin. Back in April, Bitcoin was worth over $46,000, but in June, its price fell to $19,017. This fall is a signal of a bear market. Experienced players of the crypto market understand that a bearish trend is bad news, but also new opportunities to find, buy and exchange cryptocurrency.
