The market emotion cycle is the repeating arc of crowd sentiment that drives price: optimism, excitement, euphoria (the top, maximum financial risk), then anxiety, denial, panic and capitulation (the bottom, maximum opportunity), followed by disbelief and hope. Smart money tends to sell into euphoria and buy during capitulation.
This term belongs to Trading psychology. See how it fits the bigger picture in The Mind, part of the free DEGEN ACADEMY — or watch it play out on the live terminal.
FAQ
What is Market emotion cycle?
The market emotion cycle is the repeating arc of crowd sentiment that drives price: optimism, excitement, euphoria (the top, maximum financial risk), then anxiety, denial, panic and capitulation (the bottom, maximum opportunity), followed by disbelief and hope. Smart money tends to sell into euphoria and buy during capitulation.