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The Psychology of the Stock Market

There is a certain psychology that influences the global markets which tends to be commanded by fear and greed.  According to Investopedia, “market psychology refers to the prevailing sentiment of financial market participants at any one point in time” (Staff, 2018).  The landscape of global market trading has changed since the early 2000’s.  A lot of psychological concepts of anchoring, loss aversion, recency bias, and other cognitive biases have caused abnormal fluctuations against technical patterns of market pricing.

The question is whether you believe that companies are valued on their prospective targets or are stocks merely targets of opportunity for large price fluctuations (liquidity) and easy profits?

Read more: Market Psychology

Staff, I. (2018). Market psychology.  Accessed October 10, 2018.

Published in:Uncategorized |on October 10th, 2018 |4 Comments »

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