Among all the things that drive stock prices, basic market psychology is the hardest to figure. Are you a bull or a bear? For many investors, the answer is based on little more than a gut-level premonition of where stocks are headed. Yet market psychology, or sentiment, can with little prodding shift so decisively to one side of the fear/greed spectrum that it dictates the course of stock prices for months or even years.
Years? No one frets about herd behavior when it's the bulls who have everyone brainwashed--as was the case last year. Who didn't enjoy that historic 86% jump...
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