Situation in which a majority of participants trading in the same asset are either long or short, leaving few investors to take the other side of the transaction when participants wish to close their positions. Exhaustion signals the reversal of the current trend because it illustrates excess levels of supply or demand.
Exhaustion occurs when a party cannot take the price further in their direction,naturally the other party comes in , takes charge and reverses the direction of the trend.
Read more: Exhaustion Definition | Investopedia
https://www.investopedia.com/terms/e/exhaustion.asp
and
https://www.dukascopy.com/fxcomm/fx-article-contest/?action=read&article=Trading-Exhaustion-Bars-A-Technique&id=370&language=en
