Definition ∞ A Price Consolidation Signal is a technical analysis indicator suggesting that an asset’s price is trading within a relatively narrow range after a period of significant movement. This signal often precedes a breakout or breakdown, as market participants accumulate or distribute assets without clear directional conviction. It represents a period of market equilibrium. This pattern suggests an impending price shift.
Context ∞ In cryptocurrency markets, price consolidation signals are closely watched by traders seeking to anticipate future price trends. News reports often highlight these patterns in Bitcoin or altcoin charts, interpreting them as indicators of impending volatility or a shift in market sentiment, influencing short-term trading strategies. These signals are crucial for technical analysis.
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