DEFINITION of 'Downtick'

A transaction on an exchange that occurs at a price below the previous transaction.

In order for a downtick to occur, a transaction price must be followed by a decreased transaction price. This is commonly used in reference to stocks, but it can also be extended to commodities and other forms of securities.


For example, suppose stock ABC previously traded at $10. If its next trade occurs at a price below $10, then ABC will be on a downtick.

  1. Security

    A financial instrument that represents an ownership position ...
  2. Uptick

    A transaction for a financial instrument that occurs at a higher ...
  3. Tick Size

    The minimum price movement of a trading instrument. The price ...
  4. Commodity

    1. A basic good used in commerce that is interchangeable with ...
  5. Trade

    A basic economic concept that involves multiple parties participating ...
  6. Tick Index

    The number of stocks trading on an uptick minus the number of ...
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