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| What is a Bear Market? |
A Bear Market is a period of generally falling prices of a particular type of
investment. There can be a Bear Market in the stock market, gold, bonds,
wheat and etc.
Bear Market does not indicate a period of steady price declines that are
uninterrupted by gains. Most Bear Markets are not straight down. "Two
steps down and one step up" describes the typical Bear Market.
Bear Markets can last for months, years or decades.
Bear Markets are easy to identify after the fact. Of course, knowing that the
Japanese stock market (Nikkei 225) was in a Super Bear Market from
1990 through 2003 is of little value to the investor. To have known before
1990 would have been of great value. An investor with such knowledge
would have sold Japanese equities. An investment professional may have
engaged in short selling in that market.
The problem is in the word "know". One doesn't know for sure until the Bear
Market is over. If we can't know, then what is the next best thing? Well,
some type of forecast or prediction. That is what an investor is looking for
when asking "Are we in a Bear Market?". The investor wants to know if the
market will generally fall from the present point in time. An investor with a
Bearish outlook will sell. An investor with a Bullish outlook will buy.
Investors may also ask a different but related question... How will I know that
a Bull Market is over? In other words... How will I identify the beginning of a
Bear Market. Bear Markets begin when Bull Markets end. Bull Markets
produce price gains and much confidence. At the precise time when a
powerful Bull Market ends and a Bear Market begins, there is a lot of peace
and prosperity. This presents an emotional issue. The best time to get out
of the market is often marked by prosperity and greed. It is easy to sell
when news is bad. But can you sell when rising prices, good news and
optimism characterize the investment environment? The investor needs a
signal to predict the end of the Bull Market and the beginning of a Bear
Market... A signal that can bypass the prevailing optimism and present an
objective, fact based forecast. He is looking to sell high and buy low. That
may require action to be taken contrary to natural and prevailing emotions.
Bull Market & Bear Market Timing Signal: Stock Market Forecast
investment. There can be a Bear Market in the stock market, gold, bonds,
wheat and etc.
Bear Market does not indicate a period of steady price declines that are
uninterrupted by gains. Most Bear Markets are not straight down. "Two
steps down and one step up" describes the typical Bear Market.
Bear Markets can last for months, years or decades.
Bear Markets are easy to identify after the fact. Of course, knowing that the
Japanese stock market (Nikkei 225) was in a Super Bear Market from
1990 through 2003 is of little value to the investor. To have known before
1990 would have been of great value. An investor with such knowledge
would have sold Japanese equities. An investment professional may have
engaged in short selling in that market.
The problem is in the word "know". One doesn't know for sure until the Bear
Market is over. If we can't know, then what is the next best thing? Well,
some type of forecast or prediction. That is what an investor is looking for
when asking "Are we in a Bear Market?". The investor wants to know if the
market will generally fall from the present point in time. An investor with a
Bearish outlook will sell. An investor with a Bullish outlook will buy.
Investors may also ask a different but related question... How will I know that
a Bull Market is over? In other words... How will I identify the beginning of a
Bear Market. Bear Markets begin when Bull Markets end. Bull Markets
produce price gains and much confidence. At the precise time when a
powerful Bull Market ends and a Bear Market begins, there is a lot of peace
and prosperity. This presents an emotional issue. The best time to get out
of the market is often marked by prosperity and greed. It is easy to sell
when news is bad. But can you sell when rising prices, good news and
optimism characterize the investment environment? The investor needs a
signal to predict the end of the Bull Market and the beginning of a Bear
Market... A signal that can bypass the prevailing optimism and present an
objective, fact based forecast. He is looking to sell high and buy low. That
may require action to be taken contrary to natural and prevailing emotions.
Bull Market & Bear Market Timing Signal: Stock Market Forecast
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