whipsaw (redirected from whipsaws)

Whipsaw

A condition where an investor's security transaction is quickly followed by an opposite reaction. Sometimes referred to as "being whipped".

Notes:

An example would be buying a stock and, shortly after, the stock falls substantially in price. Or the opposite, selling a stock and then having it move much higher.

See also: Risk

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whipsaw

A quick price movement followed by a sharp price change in the opposite direction. An investor expecting a continuation in the direction of a security's price movement is likely to experience whipsaw in a volatile market. This risk is very important to short-term traders but inconsequential to long-term investors.