What Is Dead Cat Bounce?

A dead cat bounce is a temporary, short-lived recovery in price during a prolonged decline. The term comes from the idea that even a dead cat will bounce if dropped from a high enough point. In crypto, dead cat bounces often occur after sharp sell-offs as bargain hunters or automated trading bots briefly push prices higher. Distinguishing a dead cat bounce from a genuine reversal requires analyzing whale behavior: if whales continue distributing during the bounce, it is likely a dead cat bounce rather than a recovery. Sonar Tracker whale flow data provides this critical context.