What characterizes a bull market?

A bull market is characterized by a sustained increase in stock prices and overall positive investor sentiment. This condition often reflects a strong economy where investors are confident about future growth. In such a market, stock prices consistently rise, which encourages more investment as people expect that the upward trend will continue.

The expectation of rising prices leads to increased buying activity, further driving up stock prices. This positive feedback loop creates an environment where optimism prevails, and investors are more willing to take risks, leading to higher trading volumes. This contrasts sharply with scenarios where stock prices are falling, stable, or trading volumes decrease, as all these conditions either reflect bearish sentiments or a lack of market activity, which are not indicative of a bull market.