Volatile Bear

Research has shown that there are 6 market types:
1) Volatile Bull
2) Quiet Bull
3) Volatile sideways
4) Quiet sideways
5) Volatile Bear
6) Quiet Bear

There is no trading strategy which works well in all 6 market types. A smart trader should have different strategies for different market types.

Ever since the Lehman Brothers crash, Nifty has been going through a volatile bear phase. Traders will find their stops getting hit frequently. How should we trade this market? It is best to remain out of this market from a momentum trading point of view. Having no position is also a position. One could look at various products in the derivatives area to profit from this market type.