Correctly understand the current stage in the market sentiment cycle

1. What is the sentiment cycle?

Regarding what is the sentiment cycle, I wrote in my previous article There is a brief discussion in "Teaching You to Stock Stock Trading":

"In stock trading, buying funds and selling funds are a typical pair of spears and shields. The strength of the two weakens each other. The trend of stocks fluctuates cyclically. This fluctuation is what I often call the emotional cycle. "

In fact, it is not just stocks, but also happens in the trading of futures, digital currencies, and even real commodities. There is market sentiment.

Any market trend is essentially driven by capital flows.

It is the buyer's and seller's funds of the transaction object, as well as the potential incremental or reduced funds that are about to enter or leave the market, that drive the development of market conditions and market sentiment.

Market sentiment is the external manifestation of capital flow. We can observe the flow of capital through market sentiment, intervene when a large amount of incremental capital is about to flow into the market, and enjoy the premium of these capital trays. Get out when a large amount of reduced funds are about to flow out of the market and reap the maximum profits.