When is Stock Overbought and Oversold?

P/E Ratio
Knowledge Center

 

Next Topic

P/E Ratio > Forum > When is Stock Overbought and Oversold?

When is Stock Overbought and Oversold?
Oscar Pyngrope, Student (MBA), India, Premium Member
WHEN IS STOCK OVERBOUGHT? "Overbought" refers to a condition in which the demand for a certain asset unjustifiably pushes the price of an underlying asset to rise to such a degree that it does not support the fundamentals. This is generally interpreted as a sign that the security is (becoming) overvalued and as a bearish indicator which represents a selling opportunity for investors. During the oversold condition the security is overvalued and may experience a pullback. WHEN IS STOCK OVERSOLD? "Oversold" is a situation in which the price of an underlying asset has fallen to a level below its intrinsic value. This is generally interpreted as a sign that the price of the security is (becoming) undervalued and is viewed as a bullish indicator which represents a buying opportunity for investors. The oversold condition is usually a result of market overreaction to bad news or panic selling. (...) Read more? Sign up for free
 

Please register now to read all responses and to join this discussion yourself. It's easy and 100% free.

    Log in

         
Special Interest Group Leader

Interested? Sign up for free.


P/E Ratio
Summary
Forum
Best Practices


    P/E Ratio
    Knowledge Center

     

    Next Topic



    About 12manage | Advertising | Link to us / Cite us | Privacy | Suggestions | Terms of Service
    2019 12manage - The Executive Fast Track. V15.2 - Last updated: 7-12-2019. All names of their owners.