Distribution exhaustion describes a market condition where selling pressure from current holders of an asset has significantly diminished, indicating a potential end to a downward price trend. This state suggests that most participants who intended to sell have already done so. It often precedes a period of price stabilization or a reversal to an upward trend. This concept is typically observed through on-chain analytics or trading volume patterns.
Context
Crypto market analysts frequently discuss distribution exhaustion in news reports when evaluating potential price bottoms for digital assets. Identifying this condition helps traders and investors anticipate shifts in market momentum. A clear signal of distribution exhaustion can precede a period of accumulation and subsequent price recovery, influencing market strategies.
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