exhaustion

ex·haus·tion   (ĭg-zôs'chən)    n.   The act or an instance of exhausting. The state of being exhausted; extreme fatigue: The runner collapsed from exhaustion.

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 Commentary

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 Links

Market Reversals And How To Spot Them
Using COT Report To Forecast FX Movements
Discovering Open Interest - Part 1
Discovering Open Interest - Part 2

See also: Commitments of Traders Report - COT, Demand, Futures Market, Long, Open Interest, Reversal, Short, Supply

Main Entry: ex·haus·tion
Function: noun
: the act or process of exhausting exhaustion of direct appellate review —W. Railroad LaFave and J. H. Israel>; specifically : EXHAUSTION OF REMEDIES

Main Entry: ex·haus·tion
Pronunciation: ig-'zos-ch&n
Function: noun
1 : the act or process of exhausting : the state ofbeing exhausted
2 : neurosis following overstrain or overexertion especially in military combat

exhaustion ex·haus·tion (ĭg-zôs'chən)
n.

1. The inability to respond to stimuli; extreme fatigue.

2. The act or an instance of using up a supply of something.

3. The extraction of the active constituents of a drug by treating with water, alcohol, or another solvent.