Applying Sentiment Detection-Best Binary Options Strategy

The first step is to decide on what market sentiment the trader wants to tag or monitor. What emotion is being expressed relating to a particular market? Th is is where the rubber meets the road. The technology of text searches at this point is still a dumb technology.The search function is extremely fast in retrieving documents, but it is not that smart at fi ltering out the noise. A lot of unrelated documents get retrieved. Th is is because the Internet is full of unstructured text. It is a bag of words that has to be categorized.

So the binary option trader is really more advanced than the search engine, at least at specifying what to look for so the search engine retrieves the right documents. Th is is called semantic processing . In February 2011,IBM demonstrated a breakthrough in semantic processing and text search when Watson won a contest on the TV show Jeopardy . Watson, as you may

recall, is the name of the IBM computer system that competed against two human competitors on Jeopardy . The breakthrough was that Watson wasn’t just searching its memory banks for keywords—it also had to understand how the words related to one another. In this era of Watson, computer programs will be important assistants in opinion mining and, as a result, it will mean any person is able to quickly understand the mood of the market. Until then, the trader has to do the work of a future Watson. But it can and should be done for Best Binary Options Strategy.

A basic understanding of market forces generates the realization that there are two major emotional forces that become expressed in the market. Those forces are market moods on risk appetite and risk aversion. You can consider

them the major axis of sentiment. However, don’t attribute negative or positive associations with either term. Using the words risk appetite and risk aversion helps describe where the crowd-mind of market opinion is clustering.In the new fundamentals, sentiment trumps economics in affecting price moves. 

This doesn’t mean fundamentals don’t count. It means that the market is not only an information engine generating valuation, it is also an expectation engine, spewing out emotions. The words “risk appetite” are code for market optimism, while risk aversions are code for market fear. Each week the balance between risk appetite and risk fear constantly shifts and a virtual

war and struggle ensues for which force is dominant. The lingo of sentiment science calls the resulting shift of sentiment sentiment polarity. The balance of sentiment and stability will shape the direction and speed of price moves. The binary option trader making a decision on direction is, in a very real sense,measuring the emotions of the market. Weekly market direction reflects a precarious balance of fears.