You may have heard people discussing a "dead cat bounce."
But do you know what it means?
Well, it the phrase is derived from an old expression that "even a dead cat will bounce once if it falls from a great height."
In finance, a dead cat bounce refers to a brief recovery in a declining trend.
Interestingly, it's hard to spot a dead cat bounce when it's really happening. But it generally has these elements:
- The stock’s price has fallen consistently;
- The stock regains value, but for a brief time;
- The stock loses value again with consistent a downward trend.
Watch the video above to learn more about this.
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