In simple terms
A dump is heavy selling over a short period that pushes price down. The word describes aggressive supply and a sharp fall; it does not by itself prove manipulation.
How it is used
In crypto, a dump may follow profit-taking, a loss of confidence, or a large order in a thin market. In a pump and dump, promoters try to sell to the public after attracting buyers. A rug pull is different: a team withdraws liquidity or abandons a project, although both events can produce a steep decline.
Limits and links
A red candle does not reveal who sold or how much supply remains. Check volume, order-book depth, and news before assigning a cause. Do not average into a falling position without a plan: price can keep dropping and execution can become expensive. See pump and dump and rug pull.
Sources
- Investor.gov, “Social Media and Investment Fraud” — warns about coordinated promotion and later selling.
- CFTC, “Risks of Virtual Currency Trading” — describes volatility and liquidity risks in virtual assets.