Please note that the dividends of the following products will be adjusted accordingly. Index dividends will be executed separately through a balance statement directly to your trading account, and the comment will be in the following format “Div & Product Name & Net Volume”.
Please refer to the table below for more details:
The above data is for reference only, please refer to the MT4/MT5 software for specific data.
If you’d like more information, please don’t hesitate to contact info@vtmarkets.com.
Written on September 4, 2025 at 9:13 am, by anakin
What if a single economic release could trigger sharp market moves in just minutes? This Friday, 5 September 2025, the US Non-Farm Payrolls (NFP) report will do exactly that. Known for shaking markets, the NFP is one of the most closely watched indicators in the world – and a key driver of the US dollar, stocks, bonds, and commodities such as gold and oil.
Last month’s release showed that only 73,000 jobs were added, far below expectations. That shortfall weakened the dollar and fuelled speculation that the Federal Reserve may cut interest rates sooner than markets previously thought. With August’s numbers about to land, traders are once again bracing for volatility.
So, what should you look for this time – and how can you prepare?
Why the NFP matters for traders
The Non-Farm Payrolls report measures how many jobs were created in the US economy during the previous month, excluding agricultural work, the military, and certain government roles.
Think of it as a monthly health check on the world’s largest economy. Strong job growth suggests businesses are hiring, consumers are spending, and momentum is strong – conditions that can keep interest rates higher for longer. Weak numbers signal slowing activity, raising the chances of rate cuts.
Markets often respond within seconds of the release. A strong upside surprise can boost the dollar and push bond yields higher. A weak print can have the opposite effect, sparking rallies in gold or even stocks if traders expect easier monetary policy ahead.
Numbers that really move markets
While the headline job creation figure grabs attention, seasoned traders know that several other components can be just as important. Here are the main ones to watch this Friday:
Job gains
Economists expect between 75,000 and 78,000 new positions. This would confirm the slowdown seen in July and keep the labour market well below early-year levels. If hiring surprises to the upside – say, 120,000 or more – it could give the US dollar fresh strength. A print below 50,000, however, might trigger renewed concern about the economy.
Unemployment rate
Forecast to remain steady at 4.2%. Even small changes matter because they show whether job seekers are finding work. A rise to 4.3% would suggest slack is building, while a dip would show resilience.
Wage growth
Average hourly earnings are expected to climb by 0.3% month on month, with annual growth near 3.9%. Faster wage growth means households have more money to spend, but it also raises inflation risks. That could make the Federal Reserve cautious about cutting rates too quickly.
Revisions to past data
In recent months, previous figures have been sharply revised downwards. For instance, July’s report cut earlier estimates for May and June by a combined 258,000 jobs. These revisions can shift market perception instantly – sometimes more than the new numbers themselves.
Labour force participation
July’s figure stood at 62.2%, broadly stable over the past year. Even slight movements here can change how the unemployment rate is interpreted. If participation falls, a steady unemployment rate might mask underlying weakness.
How markets may react
Different markets respond in different ways, and the reactions are often immediate:
US dollar (USD): Strong jobs data usually lifts the dollar; weak numbers weigh on it.
Bonds: Yields rise on strong hiring, fall on weak reports.
Shares: Stocks cheer modest weakness (rate-cut hopes) but drop if slowdown looks severe.
Gold: Gains on weak jobs data and a softer dollar; falls on strength.
Oil: Stronger hiring supports demand outlook; weaker data caps prices.
For example, in April 2025, a strong NFP print above 200,000 boosted the dollar and pushed gold down more than 2% in one day. In July, weak numbers triggered the opposite move – gold rallied while the dollar fell.
How to prepare for NFP day
For traders, the challenge with NFP is not just understanding the numbers but also reacting quickly. Market moves are often sharp yet short-lived, which means preparation is essential.
Here are some practical steps:
1. Stay informed: Keep an eye on VT Markets’ Economic Calendar for real-time updates. This ensures you don’t miss the release time or forecasts.
2. Use fast platforms: Execution speed can make all the difference during NFP volatility. VT Markets’ platforms are designed to help you react instantly.
3. Diversify your approach: The NFP doesn’t just affect currencies. With VT Markets, you can access forex, indices, commodities, and more – all of which can move when the data is released.
4. Manage your risk: Tools like stop-loss and take-profit orders allow you to set boundaries in advance. That way, you can protect your account from unexpected swings while keeping the chance to capture opportunities.
Imagine you are trading the EUR/USD. If the NFP comes in stronger than expected, the US dollar could rise sharply, pushing EUR/USD lower. Without a stop-loss, a sudden drop could erode your position quickly. With a stop-loss in place, you can limit your downside while leaving room to benefit if the report surprises the other way.
Turning volatility into opportunity
The US Non-Farm Payrolls report is more than a routine piece of data – it is a monthly catalyst that can set the tone for global markets. With forecasts pointing to another modest increase in jobs, expectations are already leaning towards a softer labour market. That means any surprise, whether stronger or weaker, could send ripples across currencies, bonds, shares, and commodities.
For traders, the opportunity lies in preparation. By knowing which numbers matter most, anticipating potential market reactions, and having the right tools at your fingertips, you can turn this event into a chance to capture new opportunities – or protect your positions.
Volatility brings both risks and rewards. This Friday, 5 September, stay ready with VT Markets and make sure you don’t miss the moves that NFP can bring.
Written on September 4, 2025 at 8:32 am, by valerie
As part of our commitment to provide the most reliable service to our clients, there will be maintenance this weekend.
Maintenance Details:
Please note that the following aspects might be affected during the maintenance:
1. The price quote and trading management will be temporarily disabled during the maintenance. You will not be able to open new positions, close open positions, or make any adjustments to the trades.
2. There might be a gap between the original price and the price after maintenance. The gaps between Pending Orders, Stop Loss, and Take Profit will be filled at the market price once the maintenance is completed. It is suggested that you manage the account properly.
3. During the maintenance period, VT Markets APP will not be available. It is recommended that you avoid using it during the maintenance.
4. During the maintenance hours, the Client portal will be unavailable, including managing trades, Deposit/Withdrawal and all the other functions will be limited.
The above data is for reference only. Please refer to the MT4/MT5 software for the specific maintenance completion and marketing opening time.
Thank you for your patience and understanding about this important initiative.
If you’d like more information, please don’t hesitate to contact info@vtmarkets.com.
Written on September 4, 2025 at 8:26 am, by anakin
Political and economic risks are shaping sentiment across global markets. US tariffs and Fed scrutiny fuel uncertainty, UK gilts rally as sterling weakens, while Japan and Turkey grapple with political instability. In Argentina, authorities step in to support the FX market amid pressure on bonds and the peso.
KEY INDICATORS
Dollar strength driven by US yields
DXY +0.66% to 98.327, marking its first gain in six sessions.
Long strategy: Consider tactical longs only if price breaks and holds above resistance with strong follow-through; target 200.00, stop-loss below 199.25.
Short strategy: Sell into rallies near 199.25 resistance; target 198.05 initially, extend back to 197.80 if momentum stalls; stops above 200.00.
Range trade: Buy near support and sell near resistance if price consolidates between 197.80–199.25.
Risk management: Keep stops tight given weakening bullish momentum.
NEWS HEADLINES
Global market and policy updates
Trump to hold emergency meeting on tariffs on Wednesday; Supreme Court appeal expected, with risk of tariff withdrawal and refunds if the ruling goes against him.
Federal Reserve Governor Cook under scrutiny as his declared primary residence is reportedly being let to tenants.
US regulators ease financial oversight, reducing the frequency of bank stress tests
UK 30-year gilt yield hits highest level since 1998; sterling slides on fiscal concerns.
Russia and the US to hold diplomatic consultations, Kremlin aide confirms.
Corporate and regional developments
Nvidia announces 2026 GTC conference to be held in San Jose, 16-19 March.
US judge rules Google is not required to divest Chrome or Android.
Japan’s Prime Minister Ishiba apologises after LDP election loss, as party officials consider resignations.
India to launch commercial semiconductor production by end-2025.
India’s tax board proposes raising EV tax on mid-range models from 5% to 18%.
Financial markets move in cycles of growth and decline. When prices rise steadily over time, traders and investors call it a bull market. Understanding what a bull market is, how it starts and ends, and how to respond to it can help you make better trading decisions. In this guide, we explain the bull market definition, its stages, advantages, risks, and historical examples, supported by real-life case studies and strategies you can use today.
What Is a Bull Market?
A bull market refers to a financial market where prices are rising consistently over a sustained period, usually by 20 percent or more from recent lows, across a broad range of securities. While the term most often applies to the stock market, bull markets can also occur in precious metals, bonds, indices, and cryptocurrencies.
The bull market meaning goes beyond price increases alone. It reflects broad investor confidence, positive economic growth, strong corporate earnings, and expectations of continued expansion. Positive market sentiment and investor expectation of future gains drive demand for securities, resulting in higher prices and rising stock prices. During these periods, optimism and demand drive markets higher, often leading to new all-time highs.
Example: Between March 2009 and February 2020, the S&P 500 rose by more than 400 percent. This 11-year period became the longest bull market in US history, fuelled by central bank support and a recovering global economy.
Key Characteristics of a Bull Market
Several features typically define a bull market:
Sustained upward trend: Markets climb steadily rather than through short-lived spikes.
High investor confidence: Optimism about future gains attracts more participants.
Corporate growth: Earnings, mergers, and IPOs accelerate.
Increased liquidity: More capital flows into markets, driving prices higher.
Low interest rates: Cheaper borrowing encourages investment and fuels growth.
Stages of a Bull Market: How It Starts and Ends
Bull markets do not begin suddenly. They form gradually as conditions improve and investor sentiment strengthens. Analysts often describe three phases:
1. Accumulation Phase (Start of a Bull Market)
This first stage usually occurs after a recession or market downturn, when prices and valuations remain low. Institutional investors and insiders start buying, anticipating a recovery before the general public notices. Sentiment is still cautious, but markets begin to stabilise and edge upward. For example, in March 2009, after the Global Financial Crisis, large funds quietly re-entered equities, sparking the longest bull run in US history.
2. Public Participation Phase (Middle of a Bull Market)
The second stage is marked by improving economic data, stronger corporate earnings, and rising investor optimism. Retail investors begin to participate more actively, volumes increase, and prices climb faster. This tends to be the longest and most profitable part of a bull market, as confidence spreads widely across the market.
3. Excess Phase (End of a Bull Market)
The final stage is often driven more by speculation than fundamentals. Prices climb to stretched valuations, optimism turns into euphoria, and investors begin to overlook risks. During this speculative phase, some investors adopt more aggressive trading strategies in pursuit of quick gains. Warning signals, such as slowing earnings or rising interest rates, are often ignored until sentiment suddenly shifts. A well-known example was the dot-com boom of the late 1990s, which ended abruptly in 2000 when overvalued technology stocks collapsed.
Historical Examples of Bull Markets
Bull markets tend to follow periods of stress or breakthrough innovation, then build as confidence and earnings improve. The snapshots below show how different catalysts can spark multi-year advances across cycles and sectors.
1. Post-War Expansion (1949 to 1966)
After World War II, the United States entered a period of rapid industrial growth and rising consumer demand. Stocks climbed more than 400 percent across this 17-year stretch as productivity gains and a young workforce supported profits. This bull market was also marked by the rise of new consumer industries, from automobiles to household appliances, which laid the foundation for decades of economic prosperity.
2. The Long Bull Run (1982 to 2000)
Falling interest rates, deregulation, and the personal-computer and internet revolutions powered a broad advance. Equities set repeated records as technology and globalisation lifted earnings for nearly two decades. By the late 1990s, investor enthusiasm reached historic levels, leading to the dot-com boom, which eventually became one of the most famous market bubbles in history.
3. Post-Global Financial Crisis Rally (2009 to 2020)
Ultra-accommodative monetary policy, improving balance sheets, and steady job growth drove a powerful recovery. A significant drop in unemployment rates and borrowing costs also contributed to the market’s rebound. From the March 2009 low to early 2020, the S&P 500 rose more than 400 percent, marking the longest US bull market on record. This rally also showed how central bank actions, such as quantitative easing, could fundamentally change investor behaviour by keeping borrowing costs near zero for over a decade.
4. Pandemic Recovery Bull Market (2020 to 2021)
Massive fiscal support and near-zero policy rates sparked a swift rebound from the 2020 crash. The injection of money through government stimulus and fiscal support increased liquidity in the markets, helping to fuel the rapid market rebound. Technology and healthcare led, with the NASDAQ gaining more than 40 percent in 2020 as remote work and digital adoption accelerated. This short but sharp bull market highlighted how quickly sentiment can shift when government policies and innovation align, though it also raised concerns about asset bubbles forming in high-growth sectors.
Advantages of a Bull Market
Bull markets provide investors with strong opportunities that can significantly shape financial growth:
Portfolio growth: Rising prices lift the value of stocks, ETFs, and other investments, helping traders and long-term investors build wealth faster. During long bull runs, equity indices like the S&P 500 can more than double in value.
Improved confidence: Investors, businesses, and consumers all become more optimistic about the economy. Higher confidence often leads to greater spending, which further supports corporate profits and market expansion. Investors also expect companies to pay dividends during bull markets, which further boosts confidence and supports higher prices.
Easier access to capital: Companies can raise funds through stock offerings or debt issuance at favourable terms. This, in turn, encourages expansion, innovation, and job creation, which sustain the upward cycle.
Positive economic feedback loop: Rising asset prices improve household wealth and spending power, reinforcing economic growth and extending the duration of the bull market.
Example: Between 2009 and 2020, the S&P 500 gained more than 400 percent, reflecting how a prolonged bull market can create wealth for investors, strengthen consumer confidence, and provide companies with the resources to expand aggressively.
Risks and Challenges in a Bull Market
Even though bull markets are attractive, they carry important risks that investors must recognise:
Overvaluation: Prices often rise faster than fundamentals like earnings and cash flow. This can leave markets vulnerable to corrections when reality catches up.
Speculative bubbles: Investor enthusiasm may shift toward hype-driven assets. When buying is based more on momentum than value, bubbles form — and they can burst quickly.
Complacency: Strong gains can make investors overconfident, leading them to ignore risk management practices such as diversification or stop-loss orders. This increases exposure when conditions turn.
Sharp reversals: Because valuations are stretched and optimism is high, even small shocks — such as interest rate hikes or geopolitical tensions — can trigger outsized market reactions.
Example: Before the 2008 financial crisis, rising property values and cheap credit gave households and investors false confidence, only for the bubble to collapse and trigger a global downturn.
How Traders and Investors Respond to a Bull Market
During a bull market, traders and investors often adjust their approach to take advantage of rising prices while still managing risk:
Buy and hold: Many investors accumulate quality stocks or ETFs and hold them for the long term. This strategy benefits from compounding as markets trend upward over several years.
Sector rotation: Traders often shift into industries that lead during a rally, such as technology, green energy, or consumer discretionary. Rotating into strong sectors allows portfolios to capture higher returns during specific phases of the bull market.
Trend following: Technical traders use tools such as moving averages, breakout levels, or momentum indicators to ride the upward wave. This helps them stay invested while prices continue to climb.
Using leverage carefully: Some traders increase exposure through margin or leveraged products to amplify gains. While this can boost profits in a bull market, it requires discipline to avoid overexposure if conditions change suddenly.
Example: During the 2023–2024 AI-driven rally, companies like NVIDIA saw their share prices climb more than 200 percent. Investors who either held long-term positions or used trend-following strategies benefited most, while those who applied leverage selectively could enhance returns without taking excessive risks.
Trading Strategies for Bull Markets
Traders and investors use a range of trading strategies to take advantage of rising markets. In a bull market, buyers often make purchases with the expectation of short-term gains, viewing each transaction as an opportunity to capitalize on rising prices. The right approach often depends on risk tolerance, time horizon, and market conditions.
1. Buy and Hold
This is the simplest strategy, where investors purchase quality stocks or ETFs and hold them throughout the bull market. It allows them to benefit from long-term gains without being distracted by short-term price movements.
Example: Investors who held Microsoft shares from 2009 through 2020 enjoyed steady compounding returns during one of the longest bull markets in history.
2. Dollar-Cost Averaging
In this approach, investors commit a fixed amount of capital at regular intervals regardless of market level. This reduces the risk of buying at a peak and steadily builds exposure as the bull market progresses.
Example: Someone who invested $1,000 monthly in the S&P 500 ETF during the 2010s built a sizeable portfolio by the end of the decade.
3. Breakout Trading
Breakout traders look for assets that rise above resistance levels with strong trading volume. Entering at these breakout points allows them to ride momentum and capture profits as the trend strengthens.
Example: Traders who entered Tesla when it broke through $200 in 2020 capitalised on its sharp upward surge.
4. Retracement Additions
Rather than chasing prices at new highs, some investors add to their positions during short-term pullbacks. This improves average entry prices while staying aligned with the broader trend.
Example: Buying the NASDAQ during brief 10 percent corrections in 2017 allowed investors to benefit as the index pushed to new highs.
5. Full Swing Trading
Swing traders aim to profit from both minor and major price moves within the overall uptrend. They buy on dips, sell on rallies, and re-enter positions, maximising returns throughout the bull cycle.
Example: In the 2021 crypto bull market, swing traders repeatedly bought Bitcoin on $8,000 to $10,000 dips and sold during sharp rallies.
6. Using Leverage Carefully
Some traders magnify exposure through margin or leveraged products. While leverage can significantly boost profits in a bull market, it requires strict discipline to avoid heavy losses if the market turns.
Example: Investors who used leveraged ETFs during the 2020 rebound doubled their gains, but mistimed positions faced steep drawdowns.
Bull Market vs Bear Market
Bull and bear markets are two opposite phases of the financial cycle. Recognising the differences between them is essential for understanding market behaviour and choosing the right strategy.
Feature
Bull Market
Bear Market
Price Trend
A sustained rise of 20 percent or more, often lasting months or years. Prices steadily move upward across most sectors.
A sustained decline of 20 percent or more, often accompanied by sharp drops in valuations across multiple asset classes.
Investor Sentiment
Optimism and confidence dominate, with investors willing to take on more risk and expect continued growth.
Fear and caution drive decisions, with investors selling assets or moving to safer havens like bonds or cash.
Economic Signals
Expanding GDP, low unemployment, and rising consumer spending create a supportive environment for growth.
Contracting GDP, rising unemployment, and weaker consumer demand signal economic stress.
Strategy
Investors focus on buy-and-hold, trend following, and building exposure to growth opportunities.
Traders and investors turn defensive, using hedging, short selling, or shifting into safe-haven assets to protect capital.
Common Mistakes Traders Make During Bull Markets
Even during strong uptrends, traders and investors often make avoidable errors that limit returns or increase risk:
Over-leveraging positions: Using excessive margin or high leverage can magnify gains, but it also exposes portfolios to heavy losses if the market pulls back even slightly.
Chasing hype stocks at inflated valuations: Many investors get caught up in popular trends and buy assets long after they have surged, leaving little room for further upside and a high risk of reversal.
Ignoring diversification: Concentrating too heavily in a single stock, sector, or asset class may work temporarily, but it leaves portfolios vulnerable if that area underperforms.
Letting FOMO override discipline: Fear of missing out often leads to impulsive buying without proper analysis or risk controls, which can undermine long-term performance.
In Summary
A bull market is defined by rising prices, optimism, and strong economic conditions, often lasting months or even years.
Bull markets move through stages — they start with accumulation, gain strength through public participation, and often end in excess.
They provide opportunities for portfolio growth, higher confidence, and easier access to capital, but risks like overvaluation, bubbles, and complacency remain.
Traders respond with strategies such as buy and hold, dollar-cost averaging, breakout trading, retracement additions, swing trading, and careful use of leverage.
Understanding bull market vs bear market and avoiding common mistakes helps investors capture gains while protecting against downside risks.
The term bull market refers to a period of rising prices that signals strong investor confidence and economic optimism. It generally means markets are supported by growth, low unemployment, and healthy corporate earnings, making it a favourable time for long-term investing.
2. How long do bull markets last?
Bull markets can last from several months to more than a decade. For example, the 2009–2020 US bull market lasted nearly 11 years.
3. Can you predict when a bull market will end?
It is difficult to predict exactly. Warning signs include slowing economic growth, rising interest rates, and stretched valuations.
4. Are crypto bull markets riskier than stock bull markets?
Yes. While both can deliver large gains, crypto bull markets tend to be more volatile, with sharper rises and steeper corrections.
5. What triggers the start of a bull market?
Bull markets often begin after periods of economic slowdown or recession. Key triggers include improving GDP growth, strong corporate earnings, and accommodative central bank policies such as lowering interest rates or launching stimulus programs.
6. Do bull markets only happen in stocks?
No. Bull markets can also occur in other asset classes such as commodities, bonds, and cryptocurrencies. For example, gold entered a bull market in 2020, and Bitcoin saw a bull market in 2021 when it surged above $60,000.
7. Is it safe to invest during a bull market?
Bull markets offer strong opportunities, but safety depends on strategy and discipline. Investors should diversify, avoid chasing hype stocks, and use risk management tools like stop-losses to protect gains.
8. How can beginners take advantage of a bull market?
Beginners can start with simple approaches such as dollar-cost averaging into index funds or practising strategies in a demo account. This helps build confidence while reducing the risk of entering the market at an unfavourable time.
Written on September 3, 2025 at 10:36 am, by jason
Please note that the dividends of the following products will be adjusted accordingly. Index dividends will be executed separately through a balance statement directly to your trading account, and the comment will be in the following format “Div & Product Name & Net Volume”.
Please refer to the table below for more details:
The above data is for reference only, please refer to the MT4/MT5 software for specific data.
If you’d like more information, please don’t hesitate to contact info@vtmarkets.com.
Written on September 3, 2025 at 9:56 am, by anakin
Financial markets move in cycles of growth and decline, and when prices fall sharply for a prolonged period, investors face what is known as a bear market. In this article, you will learn what a bear market is, the different types, historical examples, and how long they usually last. We will also cover common mistakes to avoid, strategies traders and investors use to respond, and the key differences between bear and bull markets, so that you can better understand risks and opportunities during a stock market downturn.
What Is a Bear Market?
A bear market is generally defined as a sustained decline of 20% or more from the recent peak in a major index or asset class, such as the S&P 500 or Dow Jones Industrial Average, entering what is known as bear market territory. This bearish phase is characterised by a significant price decline is characterized by a significant price decline and reflects widespread pessimism, weaker economic conditions, and reduced investor confidence. Bear markets can affect stock markets globally, as well as precious metals, currencies, and bonds.
Bear markets are often triggered by slowing economic growth, high inflation, or rising interest rates. Geopolitical crises and unexpected global events can also undermine confidence and spark declines. For example, during the COVID-19 pandemic in March 2020, the S&P 500 and Dow Jones Industrial Average, both major indexes, plunged more than 30% in just over a month, making it one of the fastest bear markets in history. These periods are marked by falling stock prices and significant shifts in market sentiment as investors react to uncertainty and risk.
Key Characteristics of a Bear Market
Prolonged price decline: Markets fall by at least 20% from recent highs and often continue for months.
Negative investor sentiment: Fear and pessimism dominate, with many investors moving out of riskier assets.
Economic weakness: Slowing growth, higher unemployment, or tighter monetary policy often coincide with bear markets.
Reduced trading volumes: Many investors step back, leading to lower liquidity in markets.
Increased volatility: Sharp swings in prices are common as uncertainty drives rapid market reactions.
Different Types of Bear Markets
Not all bear markets are the same. Analysts often categorise them into three main types:
Structural bear markets: These occur when deep economic or financial imbalances build up over time, eventually causing a long-lasting downturn. They are often linked to systemic issues such as a housing bubble or banking collapse. Structural bear markets can impact global stock markets, not just domestic ones, as seen during previous bear markets like the 2008 Global Financial Crisis, when the collapse of the US housing market triggered a worldwide equity decline of more than 50%.
Cyclical bear markets: These are tied to the normal ups and downs of the economic cycle. As economic growth slows, earnings weaken, and inflation rises, markets naturally contract before the next expansion phase. For instance, the 1973–1974 recession saw stocks tumble due to soaring oil prices and inflation, but markets later recovered as the economic cycle turned.
Event-driven bear markets: These happen suddenly when an unexpected shock rattles confidence, such as a geopolitical conflict, pandemic, or natural disaster. They tend to be sharp but short-lived, as seen in previous bear markets like the 2020 COVID-19 crash, when the S&P 500 lost over 30% in weeks but rebounded quickly once governments intervened.
Historical Examples of Bear Markets
History offers many lessons about bear markets, showing how they can vary in depth, length, and recovery time, often marked by a bearish phase with falling share prices and weakening sentiment.
1. Great Depression (1929–1932)
Triggered by the stock market crash of October 1929, US stocks, including the Dow Jones, lost nearly 90% of their value over three years. Unemployment soared to 25%, and the economy shrank sharply, making it the longest and most devastating bear market in modern history. It took US stocks over 25 years to fully recover to their pre-crash levels, with the average return during the recovery period remaining subdued for many years.
2. Dot-com Bubble (2000–2002)
Fueled by excessive speculation in internet stocks, the Nasdaq Composite collapsed by about 78% as share prices of many tech companies fell sharply when they failed to generate profits. The downward trend lasted almost three years, wiping out trillions in market value before recovery began. The market took about 15 years to fully recover, and the average return in the years following the downturn was modest compared to previous bull markets.
3. Global Financial Crisis (2008–2009)
As one of the most significant recent bear markets, sparked by the collapse of mortgage-backed securities and banking failures, the S&P 500 and Dow Jones plunged 57% from their peaks. This period of falling markets and declining share prices led to massive government bailouts and monetary easing, with markets bottoming in March 2009. The bear market lasted 355 trading days, and it took about four years for the market to fully recover to previous highs. The average return following this recovery was strong, as the market entered one of the longest bull runs in history.
4. COVID-19 Pandemic (2020)
The pandemic triggered a rapid downward trend, with the S&P 500 and Dow Jones falling over 30% in just 33 trading days. Share prices dropped sharply during this period, but the market rebounded quickly, fully recovering within five months. The average return after this recovery was notably high, reflecting the swift rebound and subsequent rally.
These examples show that while bear markets can be severe and painful, they are also temporary phases that eventually give way to recovery and growth.
How Long Do Bear Markets Last?
On average, a bear market lasts about 9–14 months, although this varies widely. The 2020 bear market lasted only 33 days before recovery began, while the 2000 dot-com crash dragged on for more than two years. Understanding these timelines helps investors keep perspective and avoid making decisions based purely on fear.
Advantages and Disadvantages of Bear Markets
Like any market phase, bear markets bring both risks and opportunities. Understanding these pros and cons helps traders and investors prepare better and avoid reacting emotionally to downturns.
Advantages of Bear Markets
Buying opportunities for long-term investors: Falling prices allow investors to purchase quality stocks at significant discounts, often laying the groundwork for strong future returns once recovery begins.
Profit potential for active traders: Strategies like short selling or shifting into defensive assets such as gold (XAUUSD) and bonds can help disciplined traders generate gains even during downturns.
Risk mitigation with defensive stocks: Investing in defensive stocks can help protect portfolios during bear markets, as these stocks tend to be less volatile and provide more stability when market conditions are unfavorable.
Market correction of excesses: Bear markets often reset inflated valuations, clearing speculative bubbles and creating a healthier foundation for the next bull cycle.
Disadvantages of Bear Markets
Economic and social impact: Bear markets are often linked to recessions, which can cause widespread job losses, reduced business activity, and slower economic growth.
Decline in household wealth: Falling stock and property values reduce consumer confidence and spending power, which can further drag on the economy.
Higher volatility and uncertainty: Investors face unpredictable swings in asset prices, making decision-making more difficult and often leading to panic-driven mistakes.
How Traders and Investors Respond to Bear Markets
When faced with prolonged declines, traders and investors often adjust their strategies to protect capital and manage risk. While there is no single best approach, several common responses have proven effective during past downturns.
Moving into defensive sectors: Industries like healthcare, utilities, and consumer staples often remain resilient because demand for their products and services continues regardless of economic conditions.
Seeking safe-haven assets:Gold, the US dollar, and government bonds are traditional refuges in uncertain times. For example, gold gained nearly 25% during the 2008 financial crisis.
Using hedging tools: Instruments such as CFDs, futures, options, inverse ETFs, and short positions can help offset potential losses by providing exposure in the opposite direction of the main portfolio.
Diversifying portfolios:Diversifying your portfolios by spreading investments across regions, sectors, and asset classes reduces reliance on any single market, lowering overall risk during turbulent periods.
Bear Market vs Bull Market
Markets move in cycles, alternating between bear phases marked by declines and bull phases characterised by growth. A decline of 20% or more from recent highs puts the market in bear territory, often signaling a bearish phase and raising concerns about the market’s bottom. Understanding the differences between the two helps investors recognise market conditions and adapt strategies more effectively.
Feature
Bear Market (Decline)
Bull Market (Growth)
Price movement
Down 20% or more
Up 20% or more
Investor sentiment
Fear and pessimism
Optimism and confidence
Opportunities
Short selling, defensive strategies
Growth investing, expansion trades
This comparison highlights why knowing both sides of the cycle matters for balanced decision-making, especially when navigating the market’s decline or anticipating a potential market bottom.
Common Mistakes to Avoid When Trading Bear Markets
Many traders and investors struggle during bear markets not only because of falling prices but also because of emotional and behavioural missteps. Recognising these common errors can help you to avoid unnecessary losses and stay more disciplined during downturns.
Panic selling:Short-selling stocks during a bear market out of fear can lock in losses and cause investors to miss out on recovery opportunities. Exiting positions without a clear plan often prevents investors from benefiting when markets recover.
Ignoring diversification: Concentrated portfolios are more vulnerable, while spreading investments across sectors and regions can soften the blow.
Overleveraging: Using too much margin can magnify losses and, in extreme cases, wipe out trading accounts completely.
Trying to time the bottom: Predicting the exact market low is nearly impossible and often leads to missed opportunities when recovery begins.
Chasing quick rebounds: Some traders rush to buy every small rally, hoping the market has turned. This often leads to buying too early and suffering further losses when the decline continues.
Avoiding these mistakes can help you stay disciplined when trading in a bear market and improve long-term results.
In Summary
A bear market is a decline of 20% or more, reflecting weaker economic conditions and negative sentiment.
They are temporary phases that eventually give way to recovery.
Past examples show bear markets vary in length and severity, but also create opportunities.
Common mistakes to avoid include panic selling, overleveraging, and chasing quick rebounds.
Disciplined strategies, diversification, and long-term planning help investors navigate downturns effectively.
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A bear market is generally defined as a decline of 20% or more from recent highs in a stock index or asset class. This threshold helps separate a normal market correction from a more severe and prolonged downturn that often reflects weak economic conditions and falling investor confidence.
2. What triggers the start of a bear market?
A bear market usually begins when investors lose confidence due to slowing economic growth, rising interest rates, high inflation, or unexpected global events. These factors reduce demand for riskier assets, causing prices to fall more than 20% from recent highs.
3. How long do bear markets last?
On average, bear markets last around 9–14 months, though the duration can vary widely depending on the cause.
4. What is the difference between a bear and a bull market?
A bear market is a period of sustained price declines, usually marked by pessimism and reduced risk-taking, while a bull market is a phase of rising prices and investor optimism. Both are part of the natural market cycle, and understanding their differences helps investors adjust strategies at the right time.
5. What should traders do during a bear market?
Traders can use tools like short selling or CFDs to benefit from falling prices. However, it’s just as important to set stop losses and control position sizes to avoid heavy losses during sharp moves.
6. What should investors do during a bear market?
Investors should stay disciplined by focusing on diversification, managing risk, and avoiding emotional decisions like panic selling. Some may shift into defensive sectors or safe-haven assets, while others see bear markets as opportunities to accumulate quality stocks at discounted prices.
7. Can investors make money in a bear market?
Yes, investors can profit in a bear market through strategies such as short selling, trading CFDs, or shifting into safe-haven assets like gold. However, these approaches carry risks and require discipline and careful risk management.
8. Are bear markets always linked to recessions?
Not always. While many bear markets overlap with recessions, some downturns are event-driven and short-lived, such as the 2020 COVID-19 crash, which ended quickly despite severe short-term disruption.
Written on September 2, 2025 at 10:59 am, by jason
Sterling faces renewed pressure as bond market swings, fiscal uncertainty, and political shifts test investor confidence. Traders are watching to see whether the pound can steady or slide further.
Pound hit by debt concerns
The British pound dropped more than 1% on Tuesday, sliding to $1.3422, as a sharp selloff in UK government bonds pushed 30-year gilt yields to their highest level since 1998.
The move has reignited market concerns over the UK’s fiscal outlook and its ability to keep public debt under control.
Buffeted by this year’s surge in sterling and the slide in the dollar, British companies are upping their protection against foreign-exchange swings https://t.co/4eufNzflJP
While the downturn in gilts mirrored the broader global bond market repricing, sterling’s sharpest one-day fall since June has underscored the UK’s fragility.
Chancellor Rachel Reeves is expected to announce tax hikes in the autumn budget in a bid to meet fiscal rules, a move that could weigh on economic growth.
With the UK economy showing signs of life, most economists believe British finance minister Rachel Reeves will deliver a fiscally prudent budget, but tax rises are inevitable pic.twitter.com/Y0NzSTFrgL
At the same time, Prime Minister Keir Starmer reshuffled his cabinet this week in preparation for what is expected to be a challenging close to the year.
Rabobank strategist Jane Foley noted that although revised Bank of England expectations supported sterling last month, fiscal headwinds tied to the autumn budget may continue to limit gains.
Are fears over the dollar's demise overblown? Jane Foley from Rabobank told Reuters that a lot of the factors that created pressure on the currency earlier have now been 'downgraded' pic.twitter.com/ZAmfaYox4X
The UK is not alone in facing scrutiny. In France, 30-year bond yields surged to their highest level in over 16 years, with Prime Minister François Bayrou working to prevent a potential government collapse.
Technical analysis
Since touching February’s low near 1.2250, GBP/USD has maintained an upward trajectory, climbing steadily to a July peak of 1.3788 before retreating.
The pair is now trading around 1.3422, still holding above the key 1.3300 support zone.
Picture: GBPUSD-ECN trades at 1.34221, down 0.91% from its recent high as it shown on the VT Markets app.
Short-term moving averages (5, 10, and 30) are levelling off, signalling a consolidation phase.
Meanwhile, the MACD has eased back to hover near the zero line, reflecting a loss of momentum compared with earlier in the year.
Immediate resistance is seen at 1.3550–1.3600, with a break higher paving the way for a retest of July’s 1.3788 high.
On the downside, support remains at 1.3300, with the risk of a deeper move toward 1.3100 if that level gives way.
For now, GBP/USD appears range-bound, with direction likely to be shaped by US inflation figures, Federal Reserve policy signals, and upcoming UK growth data.
Cautious forecast
If fiscal concerns intensify and gilt yields stay elevated, GBP/USD could retest the 1.3300 threshold in the near term.
A sustained break below this level may extend losses toward 1.3100, which would mark a significant reversal from the summer rally.
Such a move could also dent investor confidence further, especially if global risk sentiment remains fragile.
However, stronger signs of fiscal discipline in Rachel Reeves’ autumn budget could provide a stabilising effect.
Clear measures to contain debt levels may help the pound recover, with a rebound towards 1.3550 becoming more likely.
In addition, any supportive developments from the Bank of England – such as firmer guidance on interest rates – could limit sterling’s downside.
Overall, traders should expect heightened volatility in the months ahead, with GBP/USD likely to remain highly sensitive to both UK fiscal signals and broader global market dynamics.
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Please refer to the table below for more details:
The above data is for reference only, please refer to the MT4/MT5 software for specific data.
If you’d like more information, please don’t hesitate to contact info@vtmarkets.com.
Written on September 2, 2025 at 8:31 am, by anakin
Markets are weighing rising risks as a US court challenges Trump’s tariffs and the Fed signals a potential rate cut in September, while the ECB emphasises flexibility. Geopolitical tensions intensify with the Russia-Ukraine war, escalating Middle East conflicts, and Turkey cutting ties with Israel. Political shifts in Thailand and reaffirmed mandates in France add to market uncertainty, while Swiss gold remains resilient amid US pressure.
KEY INDICATORS
US inflation and market reaction
US inflation data came in line with forecasts, boosting bets on a September Fed rate cut.
Dollar slipped slightly; Dollar Index down 0.001% at 97.86.
10-year Treasury yield at 4.233%, 2-year yield at 3.625%.
Commodities
Gold rose 0.9% to USD 3,448/oz, marking the best monthly gain since April; silver increased 1.53% to USD 39.7/oz.
WTI fell 0.47% to USD 63.79, Brent down 0.35% to USD 67.38, marking the first monthly decline since April.
Long strategy: Buy on dips near 198.20 support, target 199.40 initially, extend towards 199.70, stop-loss below 198.20.
Short strategy: Consider tactical shorts on failed rallies near 199.40–199.70 resistance, target 198.60 initially, extend back to 198.20 if momentum builds.
Range trade: Buy near support and sell near resistance if price consolidates between 198.20–199.70.
Risk management: Keep stops tight given the overall bullish structure.
DAX 40 (Germany)
Primary trend: Bearish, with rallies into resistance likely to attract sellers and brief moves higher expected to be short-lived.
Long strategy: Consider tactical longs only on dips holding above key support, with targets likely limited given the broader bearish backdrop, stop-loss below support.
Short strategy: Sell on rallies towards 24,200 resistance, target 23,840 initially, extend towards 23,750 if momentum builds.
Range trade: Sell near the top of the range and buy near the base if price consolidates between 23,750–24,200.
Risk management: Keep stops tight given the bearish medium-term trend.
NEWS HEADLINES
US economic and policy updates
A US court rules Trump’s tariffs illegal, but he insists the measures will remain in effect, highlighting ongoing trade uncertainty.
Fed officials signal a September rate cut as July Core PCE reaches 2.9%, amid tensions over their economic mandate and market expectations.
The Fed finalises new big-bank capital rules, with Morgan Stanley seeking a review, while a judge delays ruling on Cook’s removal, keeping her in place.
Trump cancels USD 5bn in foreign aid and advances plans to rename the “War Department”, while the Texas governor signs a new congressional map into law.
Geopolitical tensions
Zelensky pushes for deeper strikes in Ukraine as the EU pledges stronger support; heavy clashes continue in Donetsk, and Zelensky is scheduled to meet Trump with EU leaders.
The EU plans troop deployments, with France and Germany advocating secondary sanctions, as geopolitical pressure rises in the region.
Israel intensifies strikes in Gaza, killing senior figures including Hamas spokesman Abu Ubayda, while operations expand and the country considers West Bank annexation.
Turkey severs trade and closes its airspace to Israel, and Houthis target UN agencies, signalling escalation across the Middle East.
Europe and central banks
Macron commits to a full term and backs PM Bayrou in a confidence vote, reinforcing political stability in France.
The ECB keeps September policy decisions open, with Kocher stressing flexibility and Rehn warning that inflation risks remain on the downside, reflecting ongoing uncertainty in the Eurozone.
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