Price Corrections

Definition ∞ Price corrections are temporary declines in the value of an asset after a period of significant appreciation. These movements typically occur when an asset’s price has risen too rapidly, prompting profit-taking or a reassessment of its valuation. Corrections are a normal part of market cycles, helping to rebalance supply and demand.
Context ∞ News reports on price corrections in digital asset markets frequently analyze the triggers for these declines, such as shifts in investor sentiment, regulatory announcements, or macroeconomic pressures. The duration and severity of these corrections are closely watched indicators of broader market trends and investor confidence.