What Is a Bear Market? Are We In One!?

While financial experts have a specific benchmark to define a bear market, i.e. that stocks have dipped by 20% from their highest value, the actual definition of a crypto winter is not as specific. Generally, if prices drop and remain low for an extended period (normally 3 months ….. possibly, some use 6 months), investors and experts will declare a crypto winter.

What Is a Bear Market?

You have to remember though, that crypto is, by it’s very nature, volatile.  It is traded by amateurs that really don’t know what they are doing most of the time.  It’s manipulated by whales – who do!

When the market experiences prolonged price declines, this is a bearish scenario. However, if we saw a bear marked every time there was a 20% decline in the price there would be no crypto bitcoin cycle and things would get very messy.

Bear stock markets are normally associated with declines in an overall market or index like the S&P 500, but individual securities or commodities can also be considered to be in a bear market if they experience a decline of 20% or more over a sustained period of time—typically two months or more. Bear markets also may accompany general economic downturns such as a recession.

You would contrast a bear market with upward-trending bull markets.

 

The fact is, for crypto markets, there isn’t a reliable way of determining a bear market (in my opinion).  You have to read a lot of news and listen to lots of YouTube influencers and make up your won mind.  If you use indicators, it’s just get more confusing.

For instance.  The 2022 crypto bear market was a blast!  We actually started it in 2021 and it wasn’t really considered a bear market until a few weeks after a, “WTF is Bitcoin doing!” followed by a couple of stupid and very credible organisations ‘going under’ (this is typical apparently after a bull market – crypto organisation become complacent and make stupid investment decisions (a bit like governments and fiat financial companies!).

I do a lot of research when I notice prolonged sideways movement and general fear and misery.  For me, that’s the definition of a bear market.  My problem is not identifying a bear market, it’s identifying the bull market!