Market Overhang

Market Overhang - Market Overhang is an examined theory stating that in certain stocks at certain times, there is a buildup of selling pressure. This arises as a combined consequence of sales and a strong wish to sell among those who still hold the stock but fear that selling it may cause further declines. Depending on the overall liquidity in the stock, a market overhand can last for weeks, months or longer. Market overhang relates to the trading in one security, but can also apply to larger areas of the market, such as an entire sector. This creates an overhand in the stock.