Beware the 'bull trap' in a bear market: Experts caution investors

The latest upmove in the markets has cheered the investment community. The benchmark Sensex has rallied 15 per cent in just 12 sessions. Many are calling the lows made on March 23 the new bottom. 

Given the economic shock caused by the Covid-19 pandemic, it is stunning how markets have managed to hit a trough in just 69 days. 

This is the fastest the markets have taken to get out of bottom, compared to previous crises (see graphic 1). 

Experts, however, caution that the ongoing rally could be a ‘bull trap’ in a bear market. 

During previous crises, there have