What is a bull-bear line?

Exact definitions differ, but the bull-bear line is taken to be a line drawn from the moving average of a security or a market over a period of time, with price movements above the line indicating bullish conditions and movements below signalling a bearish outlook.

Where have you heard about bull-bear lines?

As an investor, you will probably have read about bull-bear lines in investment guides and in the financial media. Your financial adviser may refer to bull-bear lines when discussing market conditions, as may your fellow investors.

What you need to know about bull-bear lines.

A bull-bear line takes a moving average for a security or an index over a set period of time. The most common such period is 250 days, but longer or shorter periods can be used. Those who follow the bull-bear line believe decisive movements above or beneath it signal either bullish or bearish market conditions. But sceptics point out that such movements may prove to be meaningless and ought not to be used as the basis for investment or trading decisions. These, they say, ought to be made on the basis on analysing the investment fundamentals.

Find out more about bull-bear lines.

Bull-bear lines form part of technical investment analysis. Learn more about technical investment analysis here.