Forex Buy/Sell Ratio - A Market Sentiment Tool
The buy and sell ratio below shows the strength of buy and sell in forex pairs based on trading positions opened at several international brokers. The Buy and Sell ratio is usually used by forex traders in sentiment analysis to measure how much a forex pair tends to strengthen or weaken. This is one of the popular tools to complement other forex analysis.
| Pair | Buy/Sell Ratio |
| NZDUSD |
|
| AUDUSD |
|
| USDCAD |
|
| USDCHF |
|
| USDJPY |
|
| GBPUSD |
|
| EURUSD |
|
| NZDJPY |
|
| XAUUSD |
|
| USDCZK |
|
| USDHUF |
|
| USDMXN |
|
| USDNOK |
|
| USDPLN |
|
| USDSEK |
|
| USDSGD |
|
| USDTHB |
|
| USDTRY |
|
| USDZAR |
|
| CHFJPY |
|
| AUDCHF |
|
| GBPNZD |
|
| NZDCHF |
|
| XAGUSD |
|
| EURCZK |
|
| GBPJPY |
|
| EURAUD |
|
| EURJPY |
|
| AUDCAD |
|
| AUDJPY |
|
| AUDNZD |
|
| CADJPY |
|
| EURCAD |
|
| EURCHF |
|
| NZDCAD |
|
| EURGBP |
|
| EURHUF |
|
| EURNOK |
|
| EURNZD |
|
| EURPLN |
|
| EURSEK |
|
| EURTRY |
|
| GBPCAD |
|
| GBPCHF |
|
How does market sentiment analysis work?
Market sentiment analysis observes the consensus of market participants with assumptions that it could help to predict the direction of price movements because the market should have discounted various influences in it, including fundamental and technical factors. Market sentiments are usually divided into three:
- Bullish: Most market participants tend to expect prices to rise.
- Bearish: Most market participants tend to expect prices to go down.
- Neutral: High uncertainties ahead, so the consensus is divided. Prices mostly will stay flat or move in a limited range.
Continue Reading at Which Type of Analysis for Forex Trading is Best?
What tools can we use to analyze market sentiment?
Examining consensus in a decentralized market is clearly nonviable. Therefore, market sentiment is usually interpreted through an in-depth analysis of the current fundamental situation or by looking at price patterns on charts.
There are market sentiment analysis tools in the form of buy/sell ratios from certain brokers and Commitment of Trader data from CFTC. However, such tools do not represent the consensus of all participants in the forex market.
Continue Reading at Which Type of Analysis for Forex Trading is Best?
Why can market sentiment be difficult to understand?
Understanding market sentiment is not exactly easy because there are many factors involved. The most important one is market psychology. Emotions like fear and greed can easily affect market movements, especially following the release of important news headlines or geopolitical events. When the market is dominated by fear, it can result in massive selloffs and quick price declines in instruments like forex, stocks, and indices. Meanwhile, when greed has taken over, we will see the market rallying upwards.
Continue Reading at How to Trade Using Admiral Markets Sentiment Tools
Why shouldn't we only use market sentiment in analysis?
You would probably make use of buy/sell ratio indicators to learn whether buyers or sellers are more dominant in the market recently. But you would only know what they do "in the past and now", while what has happened could not ascertain what would come later. It should also be noted that buy/sell ratio indicators in forex trading are generally not reliable, because they won't be able to represent all market participants.
Continue Reading at Which Type of Analysis for Forex Trading is Best?
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