Blowoff

AAA

DEFINITION of 'Blowoff'

A term in technical analysis that refers to a sharp price increase that comes after a long period of price appreciation, and is followed by a fall in the price. A blowoff is seen as a rally's last breath and is a highly bearish sign.

INVESTOPEDIA EXPLAINS 'Blowoff'

This large and dramatic price movement is generally seen at the peak of a market or stock. The idea behind the bearishness of a blowoff is that it signals the activity of the most irrational and overly exuberant market participants, who, wanting to take part in the rally, momentarily push up the already-overvalued stock.

RELATED TERMS
  1. Panic Selling

    Wide-scale selling of an investment, causing a sharp decline ...
  2. Panic Buying

    A type of behavior marked by a rapid increase in purchase volume ...
  3. Technical Analysis

    A method of evaluating securities by analyzing statistics generated ...
  4. Trend

    The general direction of a market or of the price of an asset. ...
  5. Blow-Off Top

    A chart pattern that indicates a steep and rapid increase in ...
  6. Market Sentiment

    The overall attitude of investors toward a particular security ...
Related Articles
  1. A Primer On The MACD
    Technical Indicators

    A Primer On The MACD

  2. How The Power Of The Masses Drives The ...
    Active Trading Fundamentals

    How The Power Of The Masses Drives The ...

  3. An Introduction To The Relative Strength ...
    Active Trading

    An Introduction To The Relative Strength ...

  4. Weighted Moving Averages: The Basics
    Active Trading Fundamentals

    Weighted Moving Averages: The Basics

comments powered by Disqus
Hot Definitions
  1. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  2. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  3. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  4. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  5. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  6. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
Trading Center