Technically Speaking | Pat Mullaly | 6-11-21| Are Overbought & Oversold Over Used and Misunderstood?

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Many people have a misunderstanding of overbought and oversold. The term gets tossed around a lot and too much. Many traders may put too much weight on the possibility of a strong reversal when price become overbought or oversold. Overbought could mean the beginning of a new uptrend and oversold may be the beginning of a new downtrend depending on what the price of the stock has been doing. Where the signals occur in the price trend is important, has the stock been consolidating or has it been up or down trending, that may possibly make for a different outcome . In this webcast we discuss the differences between 70% overbought and 80% overbought as well as indicator zones of possible support and resistance.

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