Definition ∞ Buying the dip is a market strategy where investors purchase an asset after its price has experienced a significant decline. The premise behind this approach is a belief that the asset’s value will recover, offering an opportunity for profit. This tactic is common in volatile markets like cryptocurrency, where price corrections can be sharp but often temporary.
Context ∞ News reports often analyze instances of “buying the dip” during market downturns, examining its impact on price recovery and investor sentiment. The effectiveness of this strategy depends heavily on market analysis and risk assessment. Discussions frequently address whether a price drop represents a temporary correction or a more sustained negative trend.
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