A bull market image demonstrated by a positive trend line over a bull

What is a “bull market”?

The bull market is what investors and traders live for.

News headlines are positive and squiggly green lines dominate their investment apps. Yep, life is good when in a bull market. 

It happens when prices in the stock market, crypto market or even NFT market shoot up, typically by around 20%. When this happens, a lot of people jump on the bandwagon and start buying, causing the market to keep increasing. 

Of course, this isn't the only factor that causes a bull market. Companies reporting strong bottom lines (their overall profit) and improving investor confidence are just other examples that help prices surge. 

A bull market can be extremely profitable for a trader. Numerous trades of buying and selling in a rising market can make for a lot of gains if someone knows what they're doing.

As with all trading though, there's risk. How do we know we’ve hit the top and the only way is back down?

Are we in a "bull market"?

The best way to tell if we're in a bull market is to track large index funds such as the S&P 500 and the Dow Jones Industrial Average. Keep in mind the period of time you're focusing on when looking at a bull market; a 24-hour change won't tell the same story as what has happened over the last 5 years. Always remember to keep context in mind when looking at a rising market!

Bull markets are a lot more common in crypto due to how volatile life is there (an hour in the crypto market is a year in the stock market, after all). Bitcoin moving 10% isn't that newsworthy, whereas the S&P moving 5% often makes for front page news. Again, context is everything.

Why is it called a "bull market"?

A bull about to attack it's prey, signalling where the name 'bull market' came from

If you've read our piece on bear markets, then you might have an idea where the term bull market gets its name from.

When a bull attacks prey, their horns move in an upwards motion, and this is said to resemble a market going up. Admittedly, it's not the investing world's best analogy, but we move.

Bull and bear markets both have the terms 'bullish' and 'bearish' associated with them, too. Simply put, if someone is 'bullish' on a company then they believe that company is likely to perform well. For example:

“Have you seen Tesla's latest dog feature mode? I'm bullish on them this year.”

Make sure to let us know which company or projects you’re bullish about!

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As with all investing, your capital is at risk.

Shares is a trading name of Shares App ltd. Shares App Ltd is an appointed representative of RiskSave Technologies Ltd, which is authorised and regulated by the Financial Conduct Authority.

Meet the authors

Lucy Burgess

Lucy Burgess

Head of Content

Lucy has spent the last 8 years working in fintech. It's safe to say she's pretty passionate about making finance welcoming to everyone.

James Ashoo photo

James Ashoo

Content Writer

James has been investing for over four years. His aim is to explain the hard stuff, easily! When he's not chewing your ear off about stocks and crypto, he'll most likely be telling bad jokes.

Harjas Singh

Harjas Singh

Chief Product Officer & Co-Founder

With a wealth of experience in fintech, Harjas is the man in the know when it comes to all things product. Investing features, chatting capabilities and thriving communities – he oversees all development on the Shares app!