How to measure market sentiment
Market sentiment is a generalization of the overall dominating emotion of the majority of traders, investors. It determines the current trend of the market, as well as helps to identify the future path of the quotes and build a savvy trading strategy. As a rule of thumb, if the majority of the market wants to sell a certain currency, the market sentiment is deemed to be bearish; if most of the market participants want to buy the currency, the market sentiment is bullish. Market sentiments are fickle as the wind. They tend to change based on constant incoming news flow, economic release. Understanding the current market sentiment and exploiting it accordingly is a cornerstone for success in financial world. Here arises a big question mark. How to know/to measure dominant market sentiment?