What's mean by positioning sentiment? How positioning sentiment affect upcoming market trend? - Forex Questions and Answers - FXAnswer

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What's mean by positioning sentiment? How positioning sentiment affect upcoming market trend?

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In Trading Mindset and Psychology
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- Kingpin
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1 year ago

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0 Votes market sentiment indices try to capture the prevailing sentiment trend for a particular index or sector. In order to capture such trend, it seems reasonable to consider an aggregation of news sentiment over a well-defined time window to capture the general "mood" of the market. When performing such aggregations it may be necessary to consider normalizing the data since equity news flow, as indicated in a previous posting, is characterized by strong seasonal patterns. One way of performing a sentiment aggregation is by considering net sentiment, which simply measures the count of positive minus the count of negative news items. Without normalizing for seasonality, it becomes difficult to evaluate what values reflect high and low net sentiment as for instance high values may simply be the result of certain bursts of information. by slim 1 year ago by slim 1 year ago

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market sentiment indices try to capture the prevailing sentiment trend for a particular index or sector. In order to capture such trend, it seems reasonable to consider an aggregation of news sentiment over a well-defined time window to capture the general "mood" of the market. When performing such aggregations it may be necessary to consider normalizing the data since equity news flow, as indicated in a previous posting, is characterized by strong seasonal patterns. One way of performing a sentiment aggregation is by considering net sentiment, which simply measures the count of positive minus the count of negative news items. Without normalizing for seasonality, it becomes difficult to evaluate what values reflect high and low net sentiment as for instance high values may simply be the result of certain bursts of information.