I am new to stock market can anyone tell me What is meant by Oversold Stocks?
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I am new to stock market can anyone tell me What is meant by Oversold Stocks?
In Technical terms it is a function of RSI indicator, it specifies that stock may give a technical rebound very soon. Normally when RSI is less than 30 , many traders feel it is oversold, but it should be used in combinaton with other indicators.
In simple terms, Overbought means that people have been buying and buying and buying (perhaps because it was once a low price), to the point where the increased demand has pushed the price up, so much that the price is now quite high (perhaps a bit too high).
When large number of people keep on buying a particular stock then seeing its high demand its price gets increased. Those stocks which people are buying in large number are called over sold stocks.