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1. A change in a security's price quickly followed by another change in the opposite direction. For example, a security could rise $1 then quickly lose $2, or it could fall 50 cents then rise 75 cents. Whipsaws are significant risks for day traders and speculators who may lose large amounts of money in short-term trading.

2. To buy securities at a market top or to sell at a market bottom. That is, one whipsaws when one buys or sells securities at exactly the worst possible time. One whipsaws out of fear or out of misreading market signals. To whipsaw is also called to chatter.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved


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.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
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Observation: The proposed regulations generally mirror the rules for gains from sales of affiliate stock and prevent potential whipsawing that could occur if, for example, losses from a sale of a block of affiliate stock could not be netted against gains from a sale of another block of the same stock.
("Fragment" synonyms: "scraps," "leavings," "remnants.") The whipsawing of local unions that force concessionary bidding against one another to forstall plant closings is an obvious case of damaging fragmentation.
Employers sought peak-level bargaining to bring an end to inflationary wage rivalry and whipsawing long after they had asserted managerial control in the first half of the century.
This practice of pitting worker against worker, known as whipsawing, creates bidding wars among plants and violates the U.A.W.'s traditional principles of solidarity.