// TRADING TERMINOLOGY
What is Overbought?
A situation in which the price of an asset has risen to such a degree that it is considered to be above its intrinsic value.
In-Depth Explanation
Overbought levels are often used by technical analysts as a signal that the current uptrend may be nearing an end and a pullback or reversal is likely.
Practical Example
"The RSI is at 80, signaling that the stock is in overbought territory."
Master the language of risk
Knowing the terms is just the start. Learning how to apply them is where the edge is found.
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