Stocks And Shares - How To Trade Profitably In A Bear Market
Trading in a bull market is easier than trading in a bear market. Many traders find they can make money trading in bullish markets, but when there is a major correction underway or when the market is bearish, they literally freeze and are unable to trade successfully or find profits in their trading.
First,when a market has crumpled, it is very important to accept the proven fact that the market trend has changed from bullish to bearish. It is man's instinct to find scapegoats or to discover a reason or to rationalise away the undeniable fact that the market trend has changed. But unless the trader accepts the proven fact that he's only responsible to trade his way out of a bearish market, he'll find his position unsustainable and discover losses that add up daily as the market bearish sensibilities continue. It doesn't pay to refuse the responsibility of your own trading action and assign the blame on your broker or your buddy who has given you the "tips" that led on to your losses.
If you're faced with losses from a unexpected collapse in costs, accept that it is your job to now institute action to get out of this situation with profits.
Secondly, while in bullish markets it is easy to trade by just buying stocks that are in initial outbreaks and just holding them and coming back again after a few days to reap profits, you cannot do the same during bearish markets.
In bullish markets, you trade with the trend, and so long as the trend is up, you stand to make simple profits. To the contrary, in bearish markets, the market goes into consolidation, and trends are shorter or the market will go into a sideways direction, with costs oscillating between ranges. During bearish markets, we are far more biased towards range trading instead of trend trading. So if you don't understand how to change from utilizing trend trading to range trading, you may be caught with short term trend changes and suffer whipsaws and lose money trend trading during bearish markets. Coping with traders who have gone thru a sequence of major market corrections since 1987 has led me to conclude that there's no room for lackadaisical trading during bearish markets.
The margin of boo for a trading signal is lower when trading in a bearish market. I've seen traders who may be able to quickly change or evolve from longer trend trading to trading shorter swings in the market or range trading to be in a position to earn cash from their trades.
In bearish markets, they are happy with smaller profits, but trading more frequently and in higher volumes. To help in their margin of profits, they may be able to barter the lowest brokerage terms possible with their brokers or to use discounted online trading platforms. In bearish markets, the trader who range trade will be the person who is best positioned to use the shorter and faster rebounds that happen as stocks get oversold and retrace upwards. Accepting private responsibility and evolving to range trading will improve his possibilities to earn income during bearish markets.
First,when a market has crumpled, it is very important to accept the proven fact that the market trend has changed from bullish to bearish. It is man's instinct to find scapegoats or to discover a reason or to rationalise away the undeniable fact that the market trend has changed. But unless the trader accepts the proven fact that he's only responsible to trade his way out of a bearish market, he'll find his position unsustainable and discover losses that add up daily as the market bearish sensibilities continue. It doesn't pay to refuse the responsibility of your own trading action and assign the blame on your broker or your buddy who has given you the "tips" that led on to your losses.
If you're faced with losses from a unexpected collapse in costs, accept that it is your job to now institute action to get out of this situation with profits.
Secondly, while in bullish markets it is easy to trade by just buying stocks that are in initial outbreaks and just holding them and coming back again after a few days to reap profits, you cannot do the same during bearish markets.
In bullish markets, you trade with the trend, and so long as the trend is up, you stand to make simple profits. To the contrary, in bearish markets, the market goes into consolidation, and trends are shorter or the market will go into a sideways direction, with costs oscillating between ranges. During bearish markets, we are far more biased towards range trading instead of trend trading. So if you don't understand how to change from utilizing trend trading to range trading, you may be caught with short term trend changes and suffer whipsaws and lose money trend trading during bearish markets. Coping with traders who have gone thru a sequence of major market corrections since 1987 has led me to conclude that there's no room for lackadaisical trading during bearish markets.
The margin of boo for a trading signal is lower when trading in a bearish market. I've seen traders who may be able to quickly change or evolve from longer trend trading to trading shorter swings in the market or range trading to be in a position to earn cash from their trades.
In bearish markets, they are happy with smaller profits, but trading more frequently and in higher volumes. To help in their margin of profits, they may be able to barter the lowest brokerage terms possible with their brokers or to use discounted online trading platforms. In bearish markets, the trader who range trade will be the person who is best positioned to use the shorter and faster rebounds that happen as stocks get oversold and retrace upwards. Accepting private responsibility and evolving to range trading will improve his possibilities to earn income during bearish markets.
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