A bull market is a sustained period in which prices in a financial market rise and investors expect them to keep rising. The term is applied to whole markets, such as the shares in a stock market index, and to single assets, including Bitcoin (BTC) and other cryptocurrencies. In a bull market buyers outnumber sellers, new money flows in and falls in price tend to be short and shallow.
The opposite condition is a bear market, and traders who expect gains are described as bullish. There is no legal or official threshold for a bull market. The most widely quoted rule of thumb, used in US equity commentary and repeated by the Securities and Exchange Commission's investor education site, is a rise of 20% or more in a broad index from a recent low, sustained over at least two months. Many analysts date a bull market from the lowest point of the preceding bear market to the highest point before the next one.
Bull market in plain terms
Think of a crowded street market where a stall has started selling a popular snack. As word spreads, more people queue, the stall owner raises the price, and people still buy because they believe the snack will be even harder to get tomorrow. The queue itself becomes a reason to join.
A bull market works the same way across a whole market. Rising prices bring in more buyers, and more buyers push prices higher. It does not mean every day is a good day; prices still dip. What makes it a bull market is that, looking back over months, the general direction has clearly been up.
The 20% rule of thumb
The 20% figure is a convention, not a law of finance. It is useful because it gives journalists and analysts a common yardstick, but it is arbitrary: a market that rises 19% has not behaved very differently from one that rises 21%. Index providers and research firms also differ on the details, such as whether to measure from closing prices or intraday lows, and how long a rise must last.
The conventional dating is applied in hindsight. A bull market is usually said to have started on the day of the previous low, which can only be identified once prices have climbed 20% above it. For the US S&P 500, the run from the March 2009 low after the 2008 financial crisis to the February 2020 peak is commonly described as the longest bull market on record for that index. It ended when the index fell more than 30% in about a month during the first wave of the Covid-19 pandemic.
What drives bull markets
Rising markets usually rest on a mix of economic and psychological forces:
- Earnings and growth. In equities, sustained profit growth and an expanding economy give investors a reason to pay more for shares.
- Cheap money. Low interest rates and central bank asset purchases such as quantitative easing (QE) lower the return on cash and bonds and push investors towards riskier assets.
- Sentiment and momentum. Gains attract attention and new buyers; in crypto this is often described as FOMO (fear of missing out).
- Credit and leverage. Easy access to borrowed money, including margin trading, lets investors buy more than their own cash would allow, which amplifies the move up and the eventual move down.
The link to monetary policy is close. Long bull markets in many asset classes during the ZIRP era after 2008 coincided with near-zero policy rates, and the sharp rise in rates in 2022 coincided with falls in shares, bonds and crypto at the same time.
Bull markets in crypto
Crypto markets have moved in shorter and more violent cycles than equities. Bitcoin's major bull runs are usually dated to 2013, 2017, 2020–21 and 2024. Each ended in a deep fall, and each took the price to a new all-time high (ATH). Gains of several hundred per cent within a year have been common in these phases, which is why the 20% equity convention is rarely used for crypto: a 20% move can happen within days.
Many crypto commentators link Bitcoin's cycles to its halving, the roughly four-yearly cut in new coin issuance. The timing has roughly lined up in past cycles, but the sample is small and the cause is disputed; global liquidity, new products and regulation have mattered as well. The 2024 rise, for example, followed the SEC's approval of US spot bitcoin exchange-traded funds in January 2024, which opened a new channel for institutional money.
Late-stage crypto bull markets have often shown signs of froth: a falling Bitcoin share of total market value (see dominance), a flood of new tokens and meme coins, rising trading volume on retail venues, and slang such as "to the moon" spreading beyond specialist forums. When such a run becomes detached from any measurable value, it is often described after the fact as a crypto bubble.
Limitations of the label
A bull market is a description of what has already happened, not a forecast. It cannot tell an investor when the trend will end, and short-term technical signals such as a golden cross or a high relative strength index (RSI) reading are no more than probabilistic hints. A strong rally inside a falling market can also be mistaken for a new bull market; the opposite case is called a dead cat bounce.
Index-level labels can hide wide differences beneath them. A few very large companies, or a few large coins, can carry an index upwards while most components are flat or falling. Investors judging their own position should therefore look at their actual holdings, their risk tolerance and the possible draw-down, not only at whether commentators have declared a bull market.