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1. Beginner Course

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  1. 1. What are these cryptocurrencies?
  2. 2. Bitcoin - the story of a technological revolution
  3. 3. Satoshi Nakamoto, who is the creator of Bitcoin?
  4. 4. Vitaly Buterin – the creator of Ethereum
  5. 5. What is Blockchain, and how does it work?
  6. 6. What is an NFT token?
  7. 7. What is money?
  8. 8. Cryptocurrencies vs fiat money, which will win?
  9. 9. What is DeFi (Decentralized Finance)?
  10. 10. DeFi: opportunities, advantages and disadvantages of decentralized finance
  11. 11. What is an altcoin?
  12. 12. Stablecoins - What are they?
  13. 13. Cryptocurrency wallet - what is it?
  14. 14. Why do we talk about bull and bear markets?
  15. 15. Security in the crypto market - what rules are worth following?
  16. 16. What is the seed phrase in cryptocurrencies?
  17. 17. Dogecoin and memecoin - what are they?
  18. 18. What is a Ponzi scheme?
  19. 19. What is a Soft and Hard Fork?
  20. 20. Blockchain - examples of use
  21. 21. Is blockchain safe?
  22. 22. Smart Contracts - what are they?
  23. 23. What is Ethereum? 
  24. 24. Liquidity in the cryptocurrency market
  25. 25. What is cryptocurrency mining?
  26. 26. What is the mining difficulty?
  27. 27. Inflation and its effects on financial markets
  28. 28. What is compound interest, and how does it work?
  29. 29. Cryptocurrency wallet diversification
  30. 30. Blockchain and NFT games - how to make money on them?
  31. 31. Decentralized Apps – what are they?
  32. 32. What is Proof of Work (PoW) and what is Proof of Stake (PoS)?
  33. 33. What is Proof of Burn (PoB)?
  34. 34. What is the Proof of Authority (PoA) consensus mechanism?
  35. 35. What Are Privacy Coins and Are They Legal?
  36. 36. What is CBDC - central bank digital money?
  37. 37. What is Cryptocurrency Airdrop all about?
  38. 38. What are the types of blockchain networks?
  39. 39. Key differences between ICO, IEO and STO
  40. 40. What is IoT - the Internet of Things?
  41. 41. What is the difference between Circulating Supply and Total Supply?
  42. 42. Everything you need to know about gas fees in Ethereum!
  43. 43. The most important cryptocurrency acronyms/slang you need to know!
  44. 44. Halving Bitcoin - what is it, and how does it affect the price?
  45. 45. What is the Fear and Greed index for cryptocurrencies?
  46. 46. APR versus APY: what is the difference?
  47. 47. Snapshot from the world of cryptocurrencies - what is it?
  48. 48. Know your customer (KYC) and Anti-money laundering (AML) what are they in the cryptocurrency industry?
  49. 49. What is a whitepaper? What is its purpose, and how do you write it?
  50. 50. How do you transfer cryptocurrencies?
  51. 51. What is EURT? How does it work?
  52. 52. What is an Initial Farming Offer (IFO)?
  53. 53. What is Regenerative Finance (ReFi)?
  54. 54. Bitcoin Pizza Day
  55. 55. What Is Stagflation and Why Does It Have a Negative Impact on the Market?
  56. 56. What are decentralized DAO organizations, and how do they work? What are DAO tokens?
  57. 57. CyberPunks - the story of the most popular NFT collection in the crypto industry!
  58. 58. Michael Saylor, Self-Proclaimed Bitcoin Maximalist
  59. 59. AI blockchain - a new look into the future?
  60. 60. The Bored Ape Yacht Club (BAYC) - the story of the popular NFT collection!
  61. 61. Who is Changpeng Zhao, CEO of Binance?
  62. 62. What is blockchain network congestion, and how does it work?
  63. 63. Azuki NFT collection guide: everything you need to know about it!
  64. 64. Who Is Craig Wright, the Alleged Creator of Bitcoin?
  65. 65. What Is Bitcoin (BTC.D) Dominance?
  66. 66. What is WorldCoin? Everything you need to know about this cryptocurrency!
  67. 67. Who is Brian Armstrong - CEO of Coinbase?
  68. 68. The 10 most expensive non-fungible tokens (NFTs) ever!
  69. 69. Web3's most popular social media platforms! Will they replace the platforms we know?
  70. 70. Cryptocurrency wallets: Hot Wallet vs. Cold Wallet - key differences!
  71. 71. Gavin Wood: Blockchain Visionary and Co-Founder of Ethereum
  72. 72. The memecoin story: madness or great investment?
  73. 73. Blockchain versus databases: key differences!
  74. 74. NFT Art: The digital art revolution - history and examples!
  75. 75. Who is Galy Gensler and the SEC? How does the Securities and Exchange Commission (SEC) affect the cryptocurrency market?
  76. 76. On-chain analysis in the cryptocurrency world: Everything you need to know about It
  77. 77. What are utility tokens and what use do they have in the cryptocurrency sector?
  78. 78. Can you pass on your cryptocurrencies after death? How do you pass on a cryptocurrency inheritance?
Lesson 14 of 78
In Progress

14. Why do we talk about bull and bear markets?

With knowledge of what point in the cycle the market has reached, it will be easier for you to predict its movements. The concept of rise and fall while investing on the market is certainly familiar to you, from the basics of economics we were taught at school. As a reminder – during a boom, prices rise; during a slump, they fall with momentum. In the cryptocurrency market, these two concepts have their names. We then speak of a bull market (boom) and a bear market (bust). Today, we will characterize the differences that occur between the two. 

Bull market – characteristics 

When the cryptocurrency market experiences prolonged and strong increases, we then speak of a bull market. The investors themselves are called bulls. Why? It all comes down to the manner of the bullish attack – it hits with its horns from the bottom up. Just like the share prices of individual assets, which also rise from the down to the top. The bull market, is sensed not only by the rise in prices, but also by the mood that prevails. A bull market is accompanied by euphoria, enthusiasm, and optimism. 

How do you recognize that you are entering this type of market? Several factors must occur, of which the most important are: 

∙ A 20% increase in asset prices. 

∙ The presence of short-term corrections, following the desire of some investors to realize profits. It is important not to confuse these corrections with an impending downturn. 

∙ Crypto-asset prices are higher than at past peaks. 

∙ Investor sentiment is changing. 

Remember, that it is not conjecture, but the strategies and tools you use are the ultimate determinant of the coming market cycle. 

What does it look like to invest in a bull market? 

Before any investment, it is a good idea to prepare properly. Even during a bull market, you need to have your strategy and follow it. One would buy shares of digital assets whose prices have recently fallen sharply. Another is to follow the prevailing upward trend. This strategy gives you many options and can be tailored to the asset in question. Remember, however, that when following a trend, you must do technical analysis and follow its signals. 

A bull market ends at some point. So, how do you recognize its end and not be at a  loss? The end of a bull market in cryptocurrencies also gives us some important  signals: 

∙ The trend line is broken. 

∙ Prices failing to peak.

∙ Prices that are going head over heels, pierce the bottom of the last correction. ∙ Investors are selling off. 

∙ Moods have become more pessimistic; the market is no longer euphoric. ∙ The upward trend is turning into a downward trend. 

Bear market – characteristics 

A bear market is a preview of a coming bear market. Supply in the market is increasing, resulting in falling prices. When are we talking about it? When the signals of the end of the bull market, which we discussed earlier, appear. The bear market also owes its name to the manner in which this animal attacks. On its downside, it is certainly more difficult to recognize than a bull market. 

So, what are its characteristics? 

∙ It lasts considerably shorter than a bull market. 

∙ Inexperienced investors may misread its signals. 

∙ It requires detailed and careful observation of the market. 

∙ The sentiment and morale of cryptocurrency investors declines. ∙ A bear market is a bloody red that spreads across the charts. 

What does investing in a bear market look like? 

Definitely different. It is crucial that smaller dips not be mistaken for corrections.  Certain wrong actions taken during a bear market can be irreversible for you. Here we will also mention to you a strategy that is even more important during a bear market. When the market enters a downtrend, following your chosen methodology can protect your capital and potential profits

During a bear market, traders often use what is known as short selling when the price of an asset goes up. That is, they sell off their assets with the hope of buying them back at a significantly lower price in the future. Continued short selling is helped by following the downtrend and analysing technical indicators

A bear market also comes to an end at some point. What are the harbingers of this?  Mainly cyclical upward breakouts of asset prices. However, in this case, you need to keep a close eye on the market and investor sentiment. Such instances are not always a sign of an impending bull market. 

Summary 

From today’s lesson, you already know the basic characteristics by which the two markets differ. However, we know from experience that spotting where the market is heading can sometimes be difficult even for experienced investors. It takes years of practice, stumbling, and above all, learning and strategy.

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