Capitulation, a term used in military describing surrender, is situation where investors start selling equities in order to get into less risky investments. That means getting out of the market and giving up previous gains in stock price.
According to some investors, the only way to get out of stock is selling. After that the price should be reverse or bounce of the lows.
This market capitulation we can see very often when “big dogs” – the biggest traders start to give up and sell stocks.
Below is one video from youtube where we can see in practical way how market capitulation looks like: