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Market sentiment

Measures what the crowd feels: fear or greed. At extremes, sentiment is contrarian fuel — when EVERYONE is bullish, no buyers are left. Complements the COT (real positioning) already in this pillar.

By the TradingCalculator.Pro team · Updated on · About us

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What you will learn

VIX — the fear index

Expected implied volatility of the S&P 500. >30 = panic (historically near bottoms), <15 = complacency (beware tops). Not an entry signal — regime context.

Put/call ratio

Puts traded ÷ calls traded. Very high = extreme fear (possible bottom); very low = euphoria (possible top). A contrarian thermometer at extremes, useless mid-range.

Fear & Greed Index

A composite (0-100) mixing momentum, volatility, safe-haven demand and more. Crypto has its own version. Readings <20 or >80 mark extremes worth watching for turns; in between, ignore it.

Surveys & retail positioning

Surveys like AAII (bull/bear %) and the client positioning brokers publish. When retail is massively on one side, the market usually ends up going the other way — you are someone's liquidity.

How to use it without burning

Extreme sentiment is NOT timing: markets can stay euphoric for months. Use it as a filter (don't buy euphoria, don't sell panic) and ALWAYS wait for price confirmation (structure, candles) before trading the turn.

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