A Relief Rally is a short-term increase in the price of a security or market index that occurs in response to news or events that are perceived as being positive or less negative than expected.A relief rally can be triggered by a variety of factors, including: -
Earnings reports that are better than expected
Positive economic data or news
Resolutions to political or geopolitical conflicts
Positive developments in ongoing legal or regulatory proceedings
Relief rallies are often seen as a temporary reprieve from negative market conditions, and they may not necessarily indicate a sustained trend reversal. As such, they can present opportunities for traders to take advantage of short-term price movements, but they also carry the risk of potential losses if the underlying negative conditions persist.
