Exhaustion
Definition of 'Exhaustion'Situation in which a majority of participants trading in the same asset are either long or short, leaving few investors to take the other side of the transaction when participants wish to close their positions. Exhaustion signals the reversal of the current trend because it illustrates excess levels of supply or demand. |
|
Investopedia explains 'Exhaustion'Traders can identify periods of exhaustion by looking at the Commitments of Traders Report. This report is published every week and shows levels of open interest in the futures markets. An excessively high number of long contracts could indicate that everybody who wishes to be long has already taken a position, leaving few investors to buy these assets back at a higher price. |
Related Definitions
Articles Of Interest
-
The Seven-Day Extension Fade
It's possible to pick a top or bottom with no indicator support. We'll show you how this strategy works. -
Using Open Interest To Find Bull/Bear Signals
Volume should inform your use of this indicator in confirming trends and reversals. -
Intro To Open Interest In The Futures Market
Applied primarily to the futures market, this indicator confirms trends and reversals. -
Forex: The Moving Average MACD Combo
Learn a strategy with clear entry and exit levels that will get you into a trend at the right time. -
Forecast The FX Market With The COT Report
Three empirical findings on futures data can help currency traders determine buy and sell points. -
Market Reversals And How To Spot Them
The sushi-roll indicator may help lower the risk of trying to pick market tops and bottoms. -
How Interest Rates Affect The Housing Market
Understand how rate changes can affect home prices, and learn how you can keep up. -
Uncovering Oil And Gas Futures
Find out how to stay on top of data reports that could cause volatility in oil and gas markets. -
Trading Is Timing
Learn how to make gains even if you don't get in at the right time. -
Leading Economic Indicators Predict Market Trends
Leading indicators help investors to predict and react to where the market is headed.
Free Annual Reports