How to gauge market sentiment using technical analysis techniques

Generally, trading in line with the direction of the market sentiment is considered a safer approach, since the risk-return ratio is more favourable

Sentiment is the overall view of market participants about a particular stock or the market as a whole. It is an integral part of the stock market, and a clarity about sentiments helps investors build a broad view of the possible future trend: positive sentiment suggests a bullish outlook, while negative sentiment points at a bearish one.

Whenever majority favours a particular sentiment, it is said that the trend and direction are highly robust. The sideways movement of stocks indicates a confused/ mixed sentiment and sooner or later market participants are expected to take a directional view.

Generally, trading in line with