Market Psychology & Behavior

Delve into how collective emotions of fear and greed drive market bubbles and crashes, often defying logic.

A silhouette of a head with a brain made of charts and graphs.

Markets are driven by people, and people are emotional. The collective psychology of investors creates cycles of fear and greed that can lead to speculative bubbles and panicked crashes. Understanding behavioral finance and recognizing common cognitive biases are crucial skills for navigating markets that often seem irrational. Price action is the ultimate reflection of this mass psychology.