In technical analysis, a theory that the overall sentiment of investment advisers is usually wrong. That is, when most investment advisers believe that the market will be bullish, it maintains that it will in fact be bearish, and vice versa. Technical analysts who follow the advisers' sentiment theory attempt to measure overall belief and make investment decisions accordingly. See also: Sentiment index.
A contrarian technical indicator derived from market forecasts regarding the future course of security prices and predicated on the theory that when most advisers expect a certain market movement, the opposite movement is most likely to occur. For example, strong bullish sentiment from investment advisers is often considered a bearish sign, while strong bearish sentiment is considered a bullish sign. Compare sentiment index.