What does a "nofollow" link mean?

Nofollow links are links with a rel=”nofollow” HTML tag applied to them. The nofollow tag tells search engines not to follow that link. Because nofollow links do not pass PageRank they likely don’t impact search engine rankings.

E.g here <a href=”http://www.hello.com/” rel=”nofollow”>Link Text</a>  rel="nofollow" is the "no follow" tag which is telling search engines to ignore this specific link or that backlink should not pass SEO power (ie. link juice) to search engines. 

Should "no follow" links be disavowed?

Having a "no follow" tag does not mean a link is spammy and should be disavowed. They can still be valuable if they lead to referral traffic from people clicking on the link. 

Whether a link should be disavowed depends on many factors and should not be decided based on any single factor or metric. This guide should help:
https://blog.monitorbacklinks.com/seo/what-backlinks-should-you-disavow/

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