Discussing the article: "Developing a Custom Market Sentiment Indicator"
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Check out the new article: Developing a Custom Market Sentiment Indicator.
In this article we are developing a custom market sentiment indicator to classify conditions into bullish, bearish, risk-on, risk-off, or neutral. Using multi-timeframe, the indicator can provide traders with a clearer perspective of overall market bias and short-term confirmations.
Bullish Sentiment:
Occurs when traders and investors generally expect prices to rise. This is marked by stronger buying pressure compared to selling pressure. Common signs include higher highs and higher lows in price action, strong volume on upward moves, and a positive economic or news outlook. In its extreme form, bullish sentiment can lead to euphoria, where optimism becomes excessive, often near the end of a bull run.
Bearish Sentiment:
Reflects an expectation that prices will fall, with more selling pressure than buying pressure. It is commonly identified through lower highs and lower lows in price action, strong volume during downward moves, and negative economic or news developments. At its extreme, bearish sentiment can manifest as panic, driving aggressive selling that often occurs at or near market bottoms.
Author: Hlomohang John Borotho