Does sentiment move the market or other way around ?
- Thread starter jacksmith
- Start date
The funds actually move the market. They have propriety data as well as access to huge pools of cash.
Not "What" but "Why"
Price as stated above is the resultant of causitive factors. Price may be used but only once the true trend as determined by the sentiment extremes is revealed. ie buy pullbacks in price if in an uptrend, vice versa. Determining the true trend then is the goal and price history is not going to tell one where price is going. Looking in the rear view mirror to drive is fatal. Look for the extremes in greed and fear and you'll be on your way.
"There is nothing new on Wall Street or in stock speculation. What has happened in the past will happen again,
and again, and again. This is because human nature does not change, and it is human emotion that always gets
in the way of human intelligence. Of this I am sure."
--Jesse Livermore
"The financial markets are naturally set up to take advantage of and prey upon human nature. As a result, markets
initiate major intraday and swing moves with as few traders participating as possible. A trader who does not understand
how this works is destined to lose money."
--John Carter, Financial Trader
"Fear and greed drive markets. That's why to succeed as a trader, you must learn to respect the two principal driving forces
of price. To win consistently, you must put the odds in your favor by understanding when sentiment reaches an extreme at
either end of the scale and take advantage of the markets at that time."
--Boris Schlossberg, author of Millionaire Traders: How Everyday People Beat Wall Street at its Own Game
Price as stated above is the resultant of causitive factors. Price may be used but only once the true trend as determined by the sentiment extremes is revealed. ie buy pullbacks in price if in an uptrend, vice versa. Determining the true trend then is the goal and price history is not going to tell one where price is going. Looking in the rear view mirror to drive is fatal. Look for the extremes in greed and fear and you'll be on your way.
"There is nothing new on Wall Street or in stock speculation. What has happened in the past will happen again,
and again, and again. This is because human nature does not change, and it is human emotion that always gets
in the way of human intelligence. Of this I am sure."
--Jesse Livermore
"The financial markets are naturally set up to take advantage of and prey upon human nature. As a result, markets
initiate major intraday and swing moves with as few traders participating as possible. A trader who does not understand
how this works is destined to lose money."
--John Carter, Financial Trader
"Fear and greed drive markets. That's why to succeed as a trader, you must learn to respect the two principal driving forces
of price. To win consistently, you must put the odds in your favor by understanding when sentiment reaches an extreme at
either end of the scale and take advantage of the markets at that time."
--Boris Schlossberg, author of Millionaire Traders: How Everyday People Beat Wall Street at its Own Game