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Definition: Bullish and Bearish
Bullish and Bearish terms are used in respect of stock market trends. A bullish sentiment refers to an optimistic market where prices of securities and sectors are expected to rise. In contrast to this, a bearish market points to an expectation that the prices will go down.
These are just psychological inferences of investors based on past market movements and future opportunities. However, they are very subjective.
Effect on transactions
A bearish investor will always believe that the prices are going to go down and hence will look for opportunities to sell his stock and go “short” at reasonable prices. But a bullish investor has a positive attitude towards the market and hence will purchase securities and go “long” at bargain prices in the hope of earning good profits in the future.
Fig- Green shows bullish sentiment and red shows the bearish sentiment.