Definition of Market Melt-Up

What is a "market melt-up"? What is the definition of a "market melt up"?

You can probably guess that a "melt-up" is the opposite of a "meltdown".

When the market "melts down", major market indexes tank. This is usually triggered by some sort of geopolitical event (the start of a war, terrorist attack, etc) or the beginning of an economic downturn (recession, depression).

In a "market meltdown", major indexes (such as the DJIA and NASDAQ) in the United States), may fall anywhere from 10-50%.

A "melt up" is the exact opposite - a "melt up" occurs when the markets suddenly explode higher.

A "melt up" might be triggered by:

1. Decreasing interest rates.
2. Strong earnings reports from prominent companies.
3. Economic recovery.

In a market "meltdown", investors look for any reason to sell. The attitude is "sell first, think later".

In a market "melt up", investors are buying first and thinking later.

Market melt ups can result in increases of anywhere from 20 to 100%+ for the major market indexes.

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