Modern participants have rarely faced severe bear market conditions. Most players wrongly believe that profits will continue even in a major decline as long as they just flip their long strategies upside down. But worldwide bear markets present difficult conditions for most short-side participants. Trend-following tactics often fail as sudden squeezes offer no escape and induce heavy losses.

A special personality marks each secular bear market. Inflation or oil prices may drive some while overheated economics or asset overvaluation awakens others. But bear markets all display one common characteristic: they make it much harder to turn short-term profits than typical bull markets. Swing traders should prepare for the next downturn now so that they survive and profit while waiting for better conditions.

Pattern Cycles suggest effective short sale tactics during individual stock bear markets. But volume drops sharply through most phases of a broad worldwide bear depression. This induces illiquidity and dangerous trading conditions. Spreads widen and slippage increases for both entries and exits. Opportunities vanish as good short sale inventories dry up at many broker-dealers. Reliable information disappears and good sources close shop due to a lack of interest.

Bear markets appear through many time frames. They can represent grand bear markets, cyclical bear markets, intermediate-term corrections or minor downswings. Minor downtrends can last a few minutes or days. Longer ones may persist for several months. Grand bear markets can span decades and embed multiple cyclical bull-bear swings. These cyclical swings pose the greatest threat for modern swing traders. Historically this particular bull-bear cycle lasts about 4 years, with 25% (or 1 year) of that time spent in active bear conditions.