Definition ∞ A risk-on signal indicates that investors are becoming more willing to allocate capital to higher-risk assets, often in anticipation of greater returns. In cryptocurrency markets, a risk-on signal might manifest as increased trading volume in altcoins, rising prices across the board, or a shift from stablecoins to more volatile assets. This sentiment typically reflects growing market confidence and a reduced perception of systemic economic threats. It indicates a preference for growth-oriented investments.
Context ∞ News analysis frequently identifies risk-on signals as precursors to broader market rallies in the digital asset space. Macroeconomic factors, such as interest rate decisions or inflation data, can significantly influence these signals. Understanding risk-on sentiment helps interpret overall market direction and investor appetite for speculative assets.
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