Definition ∞ Short term demand refers to the immediate buying interest for a digital asset, typically from traders and investors seeking quick profits or reacting to recent market movements. This demand is often characterized by rapid order placements and withdrawals, contributing to transient price fluctuations. It reflects immediate market sentiment and trading activity rather than long-term investment conviction. This type of demand can be highly reactive to news.
Context ∞ In cryptocurrency markets, short term demand is a critical factor influencing intraday price action and immediate liquidity. News events, technical analysis patterns, or sudden shifts in market sentiment can rapidly alter short term demand. Understanding its dynamics provides context for analyzing sudden price pumps or dumps and the behavior of active traders within the digital asset landscape.
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