Bear Market: The Hardest Part Is Not the Decline, But the Recovery

In a bear market, what hurts people the most is not the sharp drops. It’s the rebounds. When prices fall sharply, most investors remain calm. Everyone sees the downward trend. Everyone understands that the risks are increasing. But when the market bounces back, even briefly, hope immediately returns. That hope is the most dangerous thing. Many people don’t lose because they fail to recognize the downtrend. They lose because every time they decide to stay out and wait patiently, a green candle appears and pulls them back into the market. Why Is the Recovery Phase Dangerous? A rebound in a bear market often looks very “reasonable.” Technically: there is clear support. Structurally: there is a break of decline and recovery. News-wise: positive information appears. Psychologically: the market begins to become less pessimistic. Almost you can’t find a reason to stay out. But remember one important thing: a recovery does not mean a trend reversal. In a bear market environment, most upward moves serve only one purpose: testing the patience of participants. If the market truly wants to bottom out and enter a new uptrend, it will give you enough time to recognize it. But if it’s just a technical rebound or emotional recovery, the sooner you jump in, the more likely you are to get caught in the next correction cycle. The Short-Term Trap Many people lose not because of incorrect analysis, but because of choosing the wrong timeframe. On a 15-minute chart, you see a breakout. On a 30-minute chart, you see a complete structure. On an hourly chart, you see a trend beginning to form. But when you zoom out to the daily chart, it’s all just oscillations within an accumulation zone or a down channel. Short timeframes amplify volatility. But they do not increase the probability of success. In a bear market, trading more often usually just means making more mistakes. When Should You Stay Out? A simple but very difficult rule to follow: if you have to constantly convince yourself that “this time is different,” constantly adjust your plan, and keep finding reasons to participate, then it’s very likely that this is not the right phase to act. Some markets are not because you don’t understand them. It’s just that they are not suitable for you at that moment. Some rebounds are not impossible to catch. But the cost you pay afterward is worth considering. Therefore, more important than guessing the right direction is answering the question: Is this the right time for most investors to participate? If the answer is not clear enough, staying out is not missing an opportunity. It’s a disciplined decision. And in a bear market, sometimes holding cash and maintaining a stable mindset is more important than trying to catch every small wave. If it’s not clear enough, observing is the best action.