A **bear trap** is a situation in financial markets where the price of an asset, such as a stock or cryptocurrency, appears to be declining, leading investors to believe that a downtrend is beginning. This prompts them to sell or short the asset. However, the decline is temporary, and the price soon reverses, rising again.

Investors who were "trapped" by this false signal may end up incurring losses as they either sold their positions at a lower price or face potential losses if they were shorting the asset. Bear traps can occur due to various reasons, including market manipulation, technical patterns, or sudden changes in market sentiment.