Definition ∞ A market correction signal refers to a technical or on-chain indicator suggesting that a digital asset’s price is likely to undergo a significant downward adjustment after a period of sustained growth. These signals can stem from various factors, including excessive speculation, declining trading volume, or shifts in holder behavior. Identifying such a signal allows market participants to anticipate potential price retracements. It indicates an impending price recalibration.
Context ∞ Crypto news often reports on market correction signals, using them to explain potential price volatility or to caution investors. The key discussion involves the reliability and predictive power of different indicators in a rapidly evolving market. A critical future development concerns the integration of artificial intelligence and machine learning models to provide more accurate and timely market correction predictions.
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