overbought

[oh-ver-bawt]

adjective

1. marked by prices considered unjustifiably high because of extensive buying.

   The stock market is overbought now.

verb

1. simple past tense and past participle of overbuy.

Word History and Origins

Origin of overbought¹

First recorded in 1955–60; over- + bought

Example Sentences

GDX’s pullback on Thursday, which took it toward its lowest close for the month, may be raising worries among bulls that being so overbought for so long is finally having an effect, and may be a warning that the gold rally is near an end.

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It also snapped on Thursday a 31-session streak of being in overbought territory, which easily broke the previous record of 12 straight sessions seen in June 2019.

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Many chart watchers view RSI readings at or above 70 as signaling an overbought condition, which suggests that a stock or index has run up so much, relative to its historical behavior, that it needs to take a breather.

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See: Super Micro’s stock is its most overbought in a year.

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There’s a saying on Wall Street that overbought doesn’t mean over, because many see it as more of an ability than a condition.

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