What is capitulation in crypto?

Capitulation refers to a market phenomenon where investors lose faith in a particular asset (crypto, stocks, commodities etc.), giving up their positions in the market, leading to massive sell orders. As a result, there is a continuous decline in the asset price until a bottom is reached.

What is market capitulation?

What Is Capitulation? Capitulation describes the moment when an investor decides to surrender and sell stock at a loss. When a majority of investors sell their stock in a company at a loss, analysts call the situation market capitulation. Capitulation often occurs at the end of a panic selling cycle.

What is a capitulation phase?

Often, a capitulation phase can signal the end of a decline or a downward trend because the investors who had withheld their assets during the hysteria are unlikely to do so afterward.

What are the signs of a capitulation?

They try to anticipate the surest sign of a capitulation: the rebound in price that follows once the panic selling has run its course. Capitulation happens when a significant proportion of investors succumbs to fear and sells over a short period of time, causing the price of a security or a market to drop sharply amid high trading volume.