Definition
The term suckers' rally refers to a temporary increase in the value of a financial market or individual security, despite the lack of an improved outlook. A suckers' rally is classified as a secondary trend, since they are typically short in duration.
Explanation
Financial markets, such as commodities, bonds, and stocks, typically demonstrate an upward or downward trend over time. A suckers' rally is a secondary trend, which last from as few as a couple of days to several weeks, and represents the temporary reversal of a bearish outlook for a market or security.
Also known as a bear market bounce, a suckers' rally is characterized by an increase in the value of a financial market or security, notwithstanding the lack of fundamental improvements that would justify the surge in its value. For this reason, these types of rallies oftentimes materialize out of nowhere, and will disappear just as quickly.
Related Terms
Monday effect, weekend effect, January effect, catching a falling knife
