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Entropy 2016, 18(9), 324; doi:10.3390/e18090324

Market Sentiments Distribution Law

Escuela de Pregrado, Universidad de Chile, Santiago 8380492, Chile
Academic Editor: Kevin H. Knuth
Received: 6 August 2016 / Revised: 28 August 2016 / Accepted: 1 September 2016 / Published: 7 September 2016
View Full-Text   |   Download PDF [931 KB, uploaded 7 September 2016]   |  

Abstract

The Stock Exchange is basically ruled by the extreme market sentiments of euphoria and fear. The type of sentiment is given by the color of the candlestick (white = bullish sentiments, black = bearish sentiments), meanwhile the intensity of the sentiment is given by the size of it. In this paper you will see that the intensity of any sentiment is astonishingly distributed in a robust, systematic and universal way, according to a law of exponential decay, the conclusion of which is supported by the analysis of the Lyapunov exponent, the information entropy and the frequency distribution of candlestick size. View Full-Text
Keywords: exponential decay law; information entropy; Japanese candlesticks; Lyapunov exponent; market sentiment; stock market exponential decay law; information entropy; Japanese candlesticks; Lyapunov exponent; market sentiment; stock market
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This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited. (CC BY 4.0).

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Reyes-Molina, J. Market Sentiments Distribution Law. Entropy 2016, 18, 324.

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