Now let's take a look at the five stages of a bear market and the transition between bull and bear markets.
1. Sharp decline stage:
Everyone made a lot of money in the last round of bull market. This time it turned into a bear market, so it must fall sharply. So the first decline was very fierce.
2. Rapid rebound stage:
The first round of decline was too severe, and many people thought it was not a bear market. They still had the old idea that it would rebound after falling to the bottom. So after the first stage reached the bottom, many people who had previously escaped the top ran back to buy the bottom, which led to a rapid rebound. However, the high point of this rebound will definitely not exceed the high point of the previous round.
3. Oscillation and differentiation stage:
After the rebound in the second stage, some smart people thought that the bear market was coming and ran away quickly. Some people thought that the bull market was not over yet, so they continued to buy. At this time, some people were bullish and some were bearish.
4. Shrinking and negative decline stage:
After a long period of volatility, the market began to break the high point of the previous round, and then slowly fell or fell. At this time, basically no money can be made. In this wave of decline, it is almost at the bottom of the bear market.
5. Hesitant Rising Stage:
At this time, the market began to rise slowly, but everyone was still a little hesitant and was not sure whether the bull market was really coming. So the rise was not fierce, but it kept rising. This is actually the beginning of the bull-bear transition, and the bull market has also risen. This is the first stage of the bull market, and no one believes that it will rise.
The market always goes against the thinking of most people, and as a result, it rises all the way. After rising too much, it has reached the second stage of the bull market, and everyone thinks that it will fall back. This is also the bottoming stage before the big bull market comes, and the market valuation is low again. Generally, after the bottoming is completed, there will be a new low decline, which completes the bottoming stage. At this time, the market is volatile.
