#MarketSentimentWatch

What exactly is market sentiment?

Market sentiment could be defined as the overall attitude of investors toward a particular asset or the market as a whole. It is a feeling or tone of a market, or its psychology, as revealed through the activity and price movement. It’s important to remember that sentiment is not always based on fundamentals. That means that investors could have a particular view based on what they feel rather than what they see. ‘Buy the rumour, sell the fact’ springs to mind.

The sentiment could be described as bearish, neutral or bullish. When the bearish mood prevails, stocks are going down. The same applies to the currency - bearish sentiment would weigh on it. On the other hand, a bullish view is a positive one that supports stocks and currencies.