Bull market

Market is said to be bullish when it is rising and number of buyers are far more than number of sellers. Usually market is bullish when country's economy is strong, employment level is good and market participants believes that this uptrend will continue in long term. Traders and investors are optimistic here and aggressively buy and sell stocks.Rising market is the best time to start buying stocks as profits can be realized when stock value is at its peak. Following financial advisory services can help in earning more profitable returns here.

Bear market

Market is bearish when it is falling and there are very few buyers present. Here price of securities keeps on decreasing and sellers finds it difficult to sell as number of buyers present is very less. Traders are pessimistic and have a strong belief that market price of securities will fall further. A common characteristic of bearish market is high volatility.

Characteristics of bull and bear markets

1) Trading psychology of investors and traders

In bull market almost everyone is interested in market and more number of buyers exists as they are expecting that market will keep on rising and when stock price at its peak they can earn good profit. During bear market, negative sentiment prevails in the market and investors are looking to quickly sell out share which they are holding. Market participants loose their confidence and decides to keep their money out of the market.

2) Supply and demand

Supply and demand follows different patterns under bear and bull market. In bull market strong demand is seen for shares but supply is weak which leads to further increase in price of shares. In bear market demand is less and supply is more which leads to further decrease in price of shares.

3) Changes in economic activities

The companies whose stocks are listed over different exchange of stock market are the participants of large economy and thus market and economy are closely related. Market is bearish when weak economy is prevailing in country and most of the companies are not able to perform well because of which its share price gets declines. On the other hand bull market is aligned with strong economy and companies are performing really well.

Market movements are highly unpredictable so investors should invest their money carefully after understanding the current market trend. Also it is advised to trade with the market trend to be on the safer side and avoid earning losses. Both bear and bulls will have its impact on your investment therefore take time and carefully take your decisions at the time of trading. Traders can follow mcx tips and more as well to ensure their good earnings. Remember that in long term market has posted a positive return. Follow disciplined trading practices and stay updates with market trends and updates to frame a wise trading strategy.

Author's Bio: 

I am a financial analyst and like to read and explore more about market.