- Glossary
- Bear Trap
Bear Trap
Bear Trap refers to a situation in which investors who sell in a bear market are trapped by an unexpected rise in asset prices.
Bear Trap refers to a situation in the crypto market or financial markets where investors sell with the expectation that prices will continue to fall. A bear trap occurs when prices begin to rise unexpectedly after experiencing a short-term decline. This causes investors to sell in the belief that prices will continue to fall, and when prices rise unexpectedly, these investors often rush to close their positions. In this case, prices rise rapidly and investors who fall into the bear trap may be forced to close their positions before the price increase can catch up. In this case, investors who fall into the bear trap usually make a loss, while those who benefit from an unexpected rise in prices make a profit. Bear traps often occur during times of uncertainty and volatility in the market, requiring investors to be careful.