Definition ∞ Trading pressure refers to the collective force of buying or selling activity in a financial market that influences an asset’s price direction. Strong buying pressure typically drives prices higher, while intense selling pressure pushes them lower. This pressure is a result of aggregated market orders and investor sentiment, reflecting the supply and demand dynamics for a particular asset. It is a key indicator for understanding short-term price movements.
Context ∞ In cryptocurrency markets, trading pressure is frequently discussed in relation to large institutional orders, whale movements, or significant news events that trigger widespread buying or selling. Analyzing order books, volume data, and funding rates helps traders gauge the prevailing pressure. News reports often highlight shifts in trading pressure around key resistance or support levels, indicating potential breakouts or breakdowns. Understanding these forces is crucial for interpreting market sentiment and price action.
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