What is market psychology?

Market psychology refers to the prevailing behaviors and aggregate sentiment of market actors at any point in time. The term is often used by the financial media and analysts to explain market movement that may not be explained by other metrics, such as fundamentals.

How does market psychology affect stock prices?

Technical analysis focuses on the trends, patterns, and other indicators that drive the prices of a stock higher or lower. Market psychology is one of those drivers. The trend-following quantitative trading strategies employed by hedge funds are an example of investing techniques that rely in part on taking advantage of shifts in market psychology.

Does market psychology apply to all asset classes?

Market psychology applies to all asset classes, from stocks and bonds to forex, interest rates, and cryptocurrencies . How Can One Gauge Market Psychology?

Are marketers psychologists?

And while marketers aredefinitely not psychologists, they do use several psychologically-based observations about human behavior to communicate effectively with potential customers and increase conversions on a daily basis.