Definition ∞ Market corrections refer to short-to-medium term price declines of 10% or more from a recent peak in an asset or market. These adjustments are a natural part of market cycles, often occurring after periods of rapid price appreciation. Corrections help to reset valuations and alleviate overheating conditions. They are healthy for sustained market growth.
Context ∞ Cryptocurrency markets are known for their pronounced market corrections, which can be swift and substantial due to high volatility. News reports often analyze the causes of these pullbacks, such as profit-taking, regulatory concerns, or broader economic shifts. Understanding corrections is essential for managing risk in digital asset portfolios. These events often present buying opportunities.
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