What is Dead Cat Bounce in crypto?
**What is Dead Cat Splash?**
Dead Cat Bounce is a situation where a value asset enters a long-term downtrend, moves up for a short time and continues to fall again.
. This movement is often observed in a bear market. The price, which is moving downwards, turns upwards for a short time. This movement, which lasts for a very short time, succumbs to the selling pressure and the price makes a small peak and continues to move downwards.
**Why Does It Happen?**
Dead Cat Bounce can be made by big investors, namely whales. When the market experiences a prolonged decline and there are no new buyers for investment assets, whales intervene. They artificially create an increase by making moves to increase the price. Realizing that this rise is a dead cat bounce, investors sell their holdings for high amounts. After this small-scale rise, the market begins to decline. It even goes down from the value before the rise.
**How to Identify Dead Cat Splash?**
Dead Cat Splash is predictable. For rises following long-term declines, financial analysts say there may be a dead cat bounce. However, it is often difficult to recognize that this movement has occurred and is usually only recognized after the decline has occurred and the overall movement in price has been completed.
**Conclusion**
The Dead Cat Bounce is an important market move that investors should pay attention to. Understanding this move and reacting correctly can help traders avoid potential losses and even make profits. However, accurately predicting and understanding this movement requires experience and knowledge.
