Definition ∞ Price Dip Buying refers to the strategy of acquiring a digital asset after its price has experienced a notable, often temporary, decline. This approach is based on the expectation that the asset’s value will recover following the short-term downturn. Investors engaging in this behavior aim to purchase assets at a lower cost basis. It often signals underlying market confidence that the dip represents a buying opportunity rather than a sustained downtrend.
Context ∞ Crypto news frequently reports on instances of Price Dip Buying as an indicator of market resilience and investor conviction during corrections. Analysts observe increased transaction volumes and active addresses during price drops to confirm this behavior. A strong response of dip buying can prevent further price depreciation and establish a local price floor, suggesting robust demand.
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