A sudden decline in the price of a crypto asset is referred to as the dip suffered by that asset. Dips on price charts can be visually identified as a sharp V or a valley. It is a temporary drop in the crypto prices especially when a particular asset is expected to rise in price in the near future. There can be several reasons for a dip to take place including negative news, intervention by the government, adverse market conditions, or market manipulation.
Dip is commonly used with the expression “Buy the Dip”. However, investors must be careful while buying the dip and should do their due research. A dip in any asset should only be bought when the price of that asset is expected to rise. Continuous investments into so-called dips into a currency that does not have good fundamentals can lead to a downward spiral of owing a bag full of worthless tokens. Investors must carefully do their own research before investing their hard-earned money in any crypto asset.