Bear Market
A sustained period where stock prices fall 20% or more from recent highs, accompanied by widespread pessimism and negative investor sentiment.
Explained Simply
A bear market is the opposite of a bull market — prices fall, sentiment turns fearful, and investors flee to safety (bonds, gold, cash). Bear markets are typically triggered by economic recessions, rising interest rates, or systemic shocks. The average bear market lasts about 9-12 months and results in a 30-35% decline. During bear markets, mean reversion strategies, short selling, and options premium-selling tend to outperform. The most dangerous part of a bear market is often the rallies — sharp 5-10% bounces that trap buyers before the next leg down.
How Tradewink Uses Bear Market
When the regime detector identifies a bear market, Tradewink shifts strategy allocation toward defensive approaches: reducing position sizes, favoring mean-reversion over momentum, increasing cash allocation, and enabling bearish signals (short setups, put strategies). The AI also monitors the VIX and credit spreads for signs of capitulation that often precede bear market bottoms.
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See Bear Market in action
Tradewink uses bear market as part of its AI trading signal pipeline. Start getting signals that use this concept to find real opportunities.