Definition ∞ A cryptocurrency correction describes a significant downward price movement in the value of a digital asset or the broader crypto market, typically following a period of substantial price appreciation. This decline is generally considered a healthy market adjustment, often representing a drop of 10% to 20% from a recent peak. It helps to remove excessive speculation and establish more sustainable price levels. Such events are a common feature of volatile asset classes.
Context ∞ The discussion surrounding cryptocurrency corrections often involves analyzing market sentiment, macroeconomic factors, and technical indicators to predict their occurrence or duration. A key debate concerns whether a correction signifies a temporary dip or the beginning of a longer bear market. Critical future developments include improved analytical tools for market forecasting and investor education regarding market cycles. Crypto news frequently covers these price movements and their potential causes and effects.
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