What Is Market Trends ?
Market trends are the tendency of the market to move in a specific direction over a certain period of time. The market trends are classified as secondary trends for durations that are short, primary for durations that are medium scale and secular for time frames that are long. |
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The most common way to identify market trends by referring to it as bullish or bearish. A bullish market trends indicates upward trends, while a bearish market indicates downward trends. When the market shows a bullish trend it means investor confidence is on the rise. They invest more as they expect prices to rise in the near future. When the economy is improving, the first signs of this are though a bullish market.
The market shows bearish trends when there is a general decline in market activities. Investors do not anticipate any positive trends. If there is a 20 percent decline in the price for a two month period, the market is a bearish market. Example of bearish market trends was seen right after the famous Wall Street crash in the year 1929. It was once again witnessed during the recent economic turndown between 2007 and 2009.
Bull trends and Bear trends are primary market trends. In addition to this, there are also secondary market trends. These trends last for a short while and are influenced by primary trends. They usually last for just a couple of weeks at times they can also last for months. An example of secondary trend is the bear market rally, which is witnessed in the form of a market price rise from 10 percent to 20 percent.
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What Is Market Trends ?
