Overbought: meaning, definitions and examples
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overbought
[ ˌoʊvərˈbɔːt ]
financial market
Overbought refers to a situation in the financial markets where the price of an asset has risen too quickly or too high, making it likely to decrease in value in the near future. It often indicates that the asset is overvalued and may be subject to a correction. This term is frequently used in technical analysis to identify potential selling points.
Synonyms
excessive, inflated, overvalued.
Examples of usage
- The stock was considered overbought after its recent surge.
- Investors are wary of overbought conditions in the market.
- Technical indicators showed the asset was overbought.
- Many analysts advise caution with overbought stocks.
Translations
Translations of the word "overbought" in other languages:
🇵🇹 sobrecomprado
🇮🇳 ओवरबॉट
🇩🇪 überkauft
🇮🇩 terlalu banyak dibeli
🇺🇦 перекуплений
🇵🇱 przegrzany
🇯🇵 買い過ぎの
🇫🇷 suracheté
🇪🇸 sobrecomprado
🇹🇷 aşırı satın alınmış
🇰🇷 과매수된
🇸🇦 مبالغ فيه
🇨🇿 překoupený
🇸🇰 prekupovaný
🇨🇳 过度购买
🇸🇮 prekupljen
🇮🇸 ofkeypt
🇰🇿 артық сатып алынған
🇬🇪 გადასახლებულია
🇦🇿 artıq alınıb
🇲🇽 sobrecomprado
Etymology
The term 'overbought' is derived from the combination of two words: 'over', meaning excessively, and 'bought', which is the past participle of 'buy'. The use of 'overbought' in financial contexts dates back to the emergence of stock markets in the 19th century when traders began to formalize and analyze stock prices and trading behaviors. The concept reflects a critical aspect of market psychology, where frequent purchasing beyond reasonable valuation encourages speculative bubbles. As trading strategies evolved, particularly with the introduction of technical analysis in the 20th century, identifying overbought situations became essential for investors looking to maximize profits and minimize risks.