What is a bull market?
The definition of a bull market is when the economic conditions are good, companies are making money, people are having jobs, unemployment rates are low, and 70% of stocks are going up. This is what we called a bull market.
What is the best trading strategy in a bull market?
The best trading strategy in a bull market is trend following. Most of the time, you will make money by buy and hold. The reason this is a good strategy to use is because when most stocks are up, chances are the stock you are buying will be up as well. By buy and hold, you save a lot of commissions than if you were to swing trade. Also, the profit will likely be higher than swing trade because it is hard to buy low and sell high as a stock will likely to go even higher and hence more profit in a bull market.
How to get into a bull market?
One way to see if our economy is improving is to monitor various economic indicators. When our economy is improving, the economic indicators will reveal the story. Here are a few important economic indicators.
1. Employment Situation – This is the most important indicator. It is published the first Friday (8:30am EST) of each month covering the previous month.
2. Unemployment Insurance Weekly Claims - It is published every Thursday (8:30 AM EST) covering the previous week.
3. Consumer Price Index (CPI) – It is published 2 weeks of every month (8:30am EST) covering the previous month.
4. Producer Price Index (PPI) – It is published 2 or 3 weeks of every month (8:30am EST) covering the previous month.
5. Retail Sales – It is published two weeks of every month (8:30am EST) covering the previous month.
6. Institute for Supply Management (ISM) – It is published the first business of the month (10am EST) covering the previous month.
7. Durable Good Orders – It is published 3 or 4 weeks of every month (8:30am EST) covering the previous month.
8. Gross Domestic Product (GDP) – It is published on the final week of Jan, April, Jul and Oct (8:30am EST) covering the previous quarter.
