Definition ∞ Market breadth is a technical indicator assessing the overall participation of assets in a market’s price movement. It measures the proportion of assets that are advancing compared to those declining, providing insight into the underlying strength or weakness of a market trend. When a large number of assets are moving in the same direction, it suggests a broad and healthy trend. Conversely, a narrow market breadth, where only a few assets drive the movement, can signal potential instability or an impending reversal. This metric helps confirm market trends beyond just observing major index movements.
Context ∞ In cryptocurrency markets, analysts use market breadth to determine if a rally or decline is supported by widespread participation across various digital assets. News often references market breadth indicators to validate the sustainability of bull or bear markets. A declining market breadth during an apparent rally, for example, would be a critical development to watch for, signaling potential weakness.
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