Definition ∞ A demand zone represents a price range where significant buying interest is expected to stop or reverse a price decline. Within technical analysis of digital asset markets, this area on a price chart indicates a concentration of buy orders, suggesting a strong likelihood that assets trading into this range will experience upward price pressure. It signifies a level where market participants are prepared to acquire assets, often due to previous price action or fundamental valuation assessments. This zone acts as a potential support level for asset prices.
Context ∞ Traders and analysts frequently identify demand zones to inform their market entry strategies for various digital assets. The ability of a demand zone to hold during market corrections is a key indicator of underlying asset strength and investor confidence. Observing how prices react to these zones provides critical context for understanding short-term market movements in crypto news.
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