Key idea
The market's moods have names. Knowing them turns scary headlines into familiar, expected weather.
Markets move in cycles, and each phase has a label. The words sound dramatic, but they describe normal, recurring weather that every long-term investor lives through many times.
The vocabulary
| Term | Roughly means |
|---|---|
| Bull market | A sustained rise; optimism |
| Bear market | A sustained fall (often 20%+); pessimism |
| Correction | A shorter drop (around 10%) within an uptrend |
| Crash | A sudden, sharp fall |
Why naming them helps
A "correction" sounds far less alarming than "the market is falling," yet they are the same event. Understanding that falls are a normal, named part of the cycle, not a sign the system is broken, is what lets an investor stay calm when headlines turn frightening. Bulls and bears follow each other; neither lasts forever.
Finished reading?
Marking this complete counts today, and your streak becomes day 1.