In which phase of bull market we are in?



This phase marks the beginning of an emerging bull market trend and goesunnoticed by the majority of market participants. It’s during this period when the last bear market officially ends and the new bull market begins, however; this doesn’t become apparent until later in the cycle.

*Stages &* *Characteristics:*

* *Duration – Accounts for roughly 25% of the cycle.

* Accumulation – Smart money investors sniff out an emerging trend and accumulate in anticipation of a new bull market.

* Trend emergence – Marked by a gradual bullish price sequence of higher highs and higher lows.

* Shake-out – The initial rally becomes exhausted and the ensuing decline creates enough doubt that it shakes out the weaker hands.


In this phase the trend draws in an increasingly larger market participation base as awareness spreads. Growing participation and excitement builds, accelerating the trend and creating strong momentum.

*Stages & Characteristics:*

* *Duration – Typically the longest segment of the bull cycle, roughly 35% of the cycle.

* Momentum builds – During this phase the underlying bull market becomes apparent to a broader group of market participants. Sentiment feeds a healthy trend.

* Early on in this phase investors are still largely made up of only sophisticated investors, but as the trend matures an increasingly less-informed crowd joins the trend.

* First sentiment extreme – Attitude towards the market is healthy and able to sustain a strong trend, and sentiment doesn’t become moderately extreme until the end of the phase.

* Bear trap – Concerns regarding overvaluation and an ending cycle feed a correction. However, the dip ends with a new round of buyers and provides a base for the next leg of the cycle.


* *Duration – Roughly the final 10% of the bullish portion of the cycle.

* Renewed optimism – Market participants rebuild confidence following the last correction leading to new highs in the cycle. This reinforces bullish market psychology and the notion that the trend is sustainable, indefinitely.

* FOMO – ‘Fear of Missing Out’ sets in as the trend accelerates. During this period the least-informed market participants (i.e. – John Q. Public) join in and daily media coverage becomes widespread.

* Euphoria – At this point, many market participants believe the old rules of market cycles no longer apply and that indeed – “it’s different this time” – prices will rise indefinitely.

* The most violent segment of the blow-off phase as investor rationality goes out the window – “to infinity and beyond”. Price can even double or more in extreme cases in a very short period of time.

* ‘Smart Money’ exits – Many smart money managers exit throughout this cycle, but even as such, many sophisticated hedge fund managers are still found guilty of chasing performanc

[Do you think we all completed euphoria state or the biggest rally of fomo and euphoria is yet to come? Personally i think hydro and finance will make last high of this bull run assisted by right share. microfinance, dev bank and insurance will also make new high with all speculation on high bonus share. And the most important no big hands will be willing to play on bank at the moment.](

Comments are closed.