What Is A Crypto Bull Run?

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By reading the article “What Is A Crypto Bull Run?” published in Adaas Investment Magazine, you will get acquainted with the bullish and bearish market terms and what are strategies of each market to make a profit in general. This level of familiarity can be enough for you to invest in the cryptocurrency market. 

Table of Contents

What is the Bull Run?

Due to the growing popularity of financial markets, especially the cryptocurrency market, you may have heard the phrase “Bull Run” many times in articles and even daily investment-related conversations. But when and under what conditions is the term Bull Run used?

This phrase consists of the two words Bull Run, which literally means bullfight. To operate in financial markets, traders and investors must be familiar with many of the terms in this market so that they do not misunderstand the meanings of the sentences when studying the analysis.

In financial markets, when the market experiences an uptrend, it is called the Bullish Market, and when the market is downtrading, it is called the Bearish Market. The term Bull Run also refers to a time when investors in a bullish market are making a great profit.

What Is A Crypto Bull Run

What is the importance of Bull Run in the cryptocurrency market?

Given the nature of investing which is buying at a low price and making a profit by selling that asset at a price higher than the purchase price, it is easy to see how important a bullish market is for investors. Another natural behavior of financial markets is downtrends based on different reasons. These downtrends increase the value of the uptrend for investors.

Also in the uptrend, in addition to professional investors making a profit from their trading positions, novice investors are also in the Bull Run phase due to rising prices and making a profit, which is the importance of this Increases the market trend for all people more than before.

When does A Bull Run end?

Professional investors are always aware that no uptrend will continue forever, so they carefully consider all the signs of the beginning of a downtrend, such as the formation of a death cross pattern.

Unpredictable events such as the outbreak of Covid-19 or the recession of part of the industry due to unforeseen bankruptcies as well as adverse economic conditions can be a warning sign of the beginning of a downward trend in prices in financial markets.

The golden rule when operating in financial markets is to recognize the differences between the onset of a downtrend and the natural corrections of the market when discovering the price for an asset. When the downtrend begins to form, the chain of sellers increases more than before and buyers increase their belief in lower prices.

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What is a Bearish Market?

An upward trend in price occurs when demand for an asset increases. Conversely, when the demand for an asset decreases and the supply increases at the same time, the price of the asset decreases and forms a bearish market.

Unlike an uptrend, which is a time-consuming and very risky affair, a downturn or bear market occurs very quickly, and in volatile markets such as the cryptocurrency market, we have sometimes seen prices fall. Of course, it is possible to make a profit in a downward market, but this is much more difficult than making a profit through trading in the bull market.

What is the significance of the Bearish market?

As mentioned earlier, there are different strategies for making a profit in the bear market, which is one of the reasons why it is important to recognize the downtrend.

Investors are always trying to buy their assets at the lowest price and sell at the highest price. For this reason, in the downtrend, it is very important for them to recognize the price support levels. Another group of traders also use the strategy of Short positions in short periods of time or market corrections, which constitute a huge volume of futures market trades.

How are the terms Bullish and bearish formed?

Beliefs about the terms used in financial markets have always been very different. One of the most important theories for selecting two animals, a bull and a bear, as a symbol of an ascending and descending market, is how these animals attack.

As the bulls attack upwards with their horns and the bears pull the opponent down with their paws, the upward market is called the bullish market, and the downward market is called the bearish market.

The end words

At Adaas Capital, we hope that by reading this article you will be fully immersed in the Crypto Bull Run. You can help us improve by sharing this article which is published in Adaas Investment Magazine and help optimize this article by submitting your comments

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