In order to understand the bear trap and bull trap in the crypto money exchange, it is necessary to first master the market trends. In this respect, market trend formation refers to the instantaneous presence of financial markets. Trend movements can be in the downward or upward direction or in a static course. There are many factors that determine the market trend, or in other words, the market price: they can be based on economic reasons or related to developments outside the financial markets. While factors such as expectations, investor behavior, global economy, inflation, etc. are the dynamics arising from the world of finance; Decisions taken in domestic and foreign policy, international agreements, natural disasters and even customs and traditions are factors that are outside the financial dynamics but determine the course of trend formation.
The changes made by the market trends at various and certain time intervals are called bull or bear markets according to their formation. While the movements of an asset, commodity, commodity, stock or any investment instrument or even crypto money in certain periods in the market in question are followed by both analysts and investors; We see that it is expressed as a bull market for a trend whose general trajectory is bullish, and as a bear market when it expresses downward trends.
Bear Trap
It is the case that the fluctuations or corrections experienced during the bull periods dominated by the increase in price movements are interpreted as if they are the beginning of the month. While the panic sales experienced cause the market to say ‘bear season has come’, the panic sales of inexperienced investors may increase the sales volumes and bring short-term price decreases. This allows investors who are waiting patiently in the bull to collect goods at a lower cost. During the period of volatility, investors who made panic sales removed their assets from their portfolios without being able to sell them at a higher price.
Bear Formations
Bearish markets, which are the opposite of the bullish trend, express a decrease in the overall value of the commodity or investment instrument of the commodity in question. In trading volumes in the market, sales are more than buys. In addition to stop sales, panic sales occur with the effect of non-professional investors. In this period, making trend analyzes and selling without panicking is the most accurate move for investors. While the prevailing panic situation leads to a loss of confidence and continues to support the bear by reducing risk appetite in some investment instruments, it may also lead investors to more reliable assets or cryptocurrencies and trigger bull formations on some goods. However, it should not be forgotten that since bull and bear periods are not short-term formations, the fluctuations that may occur should be evaluated by the investor in a healthy way.
Bull Trap
It is the trap that leads the investor to act by thinking that it is the perfect time to buy based on the declines in the market. Because the market will be damaged when it falls below the point at the purchase level in the future. Successive broken resistance levels in prices have lured investors into a trap. The subsequent decline in prices is a continuation of the bear market. A bull trap is difficult to predict and requires detailed analysis. Because a rapid price increase after the downtrend can bring about a bull trap. The rapid rise after the consecutive decline and the subsequent reversal of the price level and the formation of a bull trap in the green part position.
Bull Formations
It is the state of rise in which the market course is evaluated positively and the commodity, investment instrument or crypto money in question is constantly valued. This period of time, in which optimistic approaches prevail and positive externalities are experienced, is dominated by a sense of market confidence, is an example of bullish. However, in markets where global and wide-ranging external factors are also effective, some declines or corrections may be experienced from time to time during bull periods. Global problems may cause fluctuations towards bear markets until a certain time.
