Legal Definitions - down reversal

Definition: A down reversal is a sudden decline in market prices after a period of rising trends. This term is used to describe the early stage of the decline. If the decline continues for several months, it is called a bear market. It is also known as a correction or market correction.

• After a long period of growth, the stock market experienced a down reversal, with prices dropping rapidly.
• The housing market saw a down reversal after years of steady growth, with home prices falling sharply.

These examples illustrate how a down reversal can occur in different markets, such as the stock market and housing market. In both cases, there was a period of growth followed by a sudden decline in prices. This can be caused by various factors, such as changes in economic conditions or investor sentiment.