If the sole commentary you can come up with to explain why stocks are up today is that the market is “oversold,” please shut up. Enough already with this vague reference to a highly conceptual phenomenon that is rarely, if ever, a reason for stocks to head higher. Except for a few wishful short sellers, I rarely hear an excessive amount of the term “overbought.” And that’s a good thing for me because I would also find that to be an overly simplistic phrase that would have nothing to do with initiating a market reversal.

“Oversold” is one of those terms that if you repeat it long enough it might actually mean something and maybe that’s a good strategy for the bulls. I know many investors and especially those that watch too much CNBC have come to accept this as a ready answer to the never-ending daily need to identify the sole catalyst for an entire market to move in one direction or the other. Besides, “oversold” and “overbought” is technical analysis jargon. As I have said before, technical analysis is criticized by the majority of investors for most trading days and is only palatable at the points where bulls are desperate for any answer to the market woes. I know it feels good to find an answer when things are tough but it’s usually not the right answer. And if you really don’t believe in technical analysis, please don’t believe in it on your worst days.

I agree that selling in stocks can get overdone, but as we all know, they can get even more oversold. Here’s my point - oversold describes a situation where the majority of investors who want to sell at the current price or even a bit lower have already sold. It sets up an opportunity for new buyers and holders of the stock to absorb the selling pressure at a given price, stabilize and then move higher. I doubt that occured from Friday’s close to today’s open. Oversold conditions without a positive catalyst are likely to send the price lower. Oversold conditions with a positive catalyst (other than just being oversold) can set the stage for prices to head higher. Something else must come in to encourage holders to not sell and new buyers to put new capital to work.

One of the other criticisms I have about this term is that in my world, a stock gets oversold - not a market. Even while some stocks are oversold, others may have been going higher for weeks, months or years. So, if the reason for today (or any other positive day) is that the market is oversold, what explains the stocks that were already going up? And why then, did some stocks go down today? Those were rhetorical questions to which I do not need any answers. Stocks go up, stocks go down - there are many reasons - some fundamental, some technical. There is no one-size-fits-all answer and I am confident that “oversold” isn’t even close.