November 29, 2022

Bull Market in Forex Trading

LQDFX news blog: Bull Market in Forex Trading

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Bull is an investor who believes that prices/ the market will rise. Bull Market is a market distinguished by a prolonged period of rising prices and expectation of price rise.

Widespread optimism and investors’ confidence also characterize this period of rising prices. Furthermore, such expectations that strong results should continue usually continue for months or years. Investors’ confidence will also be on the rise.

The term “bull market” is the opposite of a “bear market”.

Bull Market and volume of trades

A lot of indicators can help a trader identify a bull market, although it is not always so easy or so clear. One indicator is the volume for assessing the movement of the prices and, thus, if there is a bullish trend. Reversals are usually accompanied by a high volume of trading, whereas retracements often occur on low volume trading.

Where did the bull market get its name?

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There are various possible scenarios.

The leading theory is that it came about as a direct result of the term “bear”.  Specifically, the first known instance of the market term “bull” popped up in 1714, shortly after the “bear” term popped up.  At the time, it was something of a widespread practice to bear and bull-bait. Essentially, with bear baiting, they’d chain a bear (or bears) up in an arena, and then set some other animals to attack the bear(s) (usually dogs) as a form of entertainment for spectators seated in the arena.

One of the most popular scenarios about the origin of bull market is the observance of the animal’s method of attack; A bull thrusts its horns up into the air, while a bear swipes its paws downward. These actions are metaphors for the movement of a market. If the trend is up, it’s a bull market.

Sources: Investopedia, Merriam-Webster

PLEASE NOTE The information above is not investment advice.