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Oversold
Technical AnalysisA condition where a security's price has fallen rapidly and may be due for a bounce. Indicated by RSI below 30, Stochastic below 20, etc. Mean reversion strategies often enter on oversold signals.
Related Terms
Overbought
A condition where a security's price has risen rapidly and may be due for a pullback.
RSI (Relative Strength Index)
A momentum oscillator ranging from 0 to 100 that measures the speed and magnitude of recent price changes.
Mean Reversion
A trading philosophy based on the idea that prices tend to return to their average over time.