Definition of overbought in US English:

overbought

  • past and past participle of overbuy

adjective

Stock Market
  • Overvalued owing to excessive buying at unjustifiably high prices.

    ‘a healthy correction to an overbought market’
    • ‘When it is used as an oscillator, a positive value indicates an overbought market while a negative value indicates an oversold market.’
    • ‘In the early stages of a new trend, these indicators can stay in the overbought part of the scale for a very long time, particularly at the start of a new bull market.’
    • ‘If the RSI rises above 80, it may be indicating an overbought condition, which is a sell signal; below 20 it may be indicating an oversold stock, indicating a buy signal.’
    • ‘Rather than playing the fool's game of trying to predict an exact market top, do the sensible thing and short the stocks when TRIN falls below its overbought level - a negative reversal is near.’
    • ‘A large positive risk-reversal number implies an overbought situation, while a large negative risk-reversal number implies an oversold situation.’
    • ‘The supply line is the top line of the triangle and represents the overbought side of the market, when investors are going out taking profits with them.’
    • ‘In any extreme situation investors forget to be selective, and this is common to overbought and oversold markets.’
    • ‘Buy signals are indicated when the oscillator advances from oversold levels to positive levels, and, conversely, sell signals are indicated by declines from overbought to negative territory.’
    • ‘First off, the 20-day price channels on top of the price action allow you to follow the overbought and oversold positions of this chart.’
    • ‘The display is formatted so it better shows the overbought and oversold situations of this issue.’
    • ‘The second condition we need is of course an overbought market.’
    • ‘The technical sell-off of that oversold market had started four or five months earlier, when the markets were clearly in an overbought condition.’
    • ‘And with bullion short-term overbought and approaching $450, the $450 level would appear to be a decent resting area.’
    • ‘Many traders use them primarily to determine overbought and oversold levels, selling when price touches the upper Bollinger band and buying when it hits the lower Bollinger band.’
    • ‘In summary, the means by which traders can filter out most bad trades involves an intimate knowledge of overbought and oversold conditions.’
    • ‘At the bottom of the chart, the RSI, on a scale of 0-100, indicates that the overbought position is at 70 and the oversold position is at 30.’

Pronunciation

overbought

/ˌoʊvərˈbɔt//ˌōvərˈbôt/