ATH, or All-Time High, is the highest price a cryptocurrency or any other asset has ever reached in its history.

Understanding the Significance of an ATH

An ATH is a key psychological and technical milestone for any asset. When an asset reaches a new ATH, it means that every single person who has ever bought that asset is currently in profit. This can generate significant excitement and renewed investor interest, often leading to a period of price discovery where the asset can move higher without the resistance of previous sellers.

On the other hand, failing to break a previous ATH can indicate a lack of momentum in the market and may be a sign of a market correction. Traders and investors closely monitor an asset's price in relation to its all-time high as a way to gauge market sentiment and analyze its future price potential.

How It's Used in Trading

In a trading-pair, an ATH is a key point of reference. Some traders believe that once an asset breaks its all-time high, it has entered a new phase of price discovery and can rise significantly higher. Conversely, if an asset is far below its ATH, it might be a signal to "buy the dip," or it could indicate that the asset has lost its previous momentum and may continue to underperform. The ATH is a critical point for understanding an asset's market history and potential future trajectory.