Bull-bear line

Bull-bear line is the index average line that indicates bull market or bear market in stock market. The 250-day moving average line of certain index for previous 250 trading days is treated to be the bull-bear line, which provides reference value for mid-term and long-term investment. If the current index drops below the bull-bear line, some investors believe the market turn bearish from bullish. If the current index rises above the line, some investors believe the market turn bullish from bearish.[1]

Financial analysts have different opinions on the bull-bear line. Some believed the 250-day moving average is not the "bull-bear line". According to Dow Theory by Charles Dow, an American journalist, bull market and bear market are defined by investor's mindset. Bull market develops under extremely optimistic situations, while bear market develops under extremely pessimistic situations. There is no limitations on time duration for both markets. Investors should remind no one can expect the junction between bull and bear markets. This can only be known after the change happens.[2]

References

  1. 牛熊分界線 (Chinese version)
  2. 二百五十天移動平均線不是牛熊分界線 (Chinese version)
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