QDB Guide · Retail sentiment · about 8 minutes

Retail sentiment: the crowd train

Retail sentiment tells you what share of everyday traders are long. On its own it's just a number. Picture it as a train instead, running between Edinburgh (0% long) and London King's Cross (100% long), and it starts telling you when to get on, which way, and when the line runs out.

The short version

The crowd is usually on the wrong side of the move, so you board going the opposite way to the crowd's bets. But only at a station: a strong weekly or daily level.

HEADING SOUTH: LOOK TO SELL

  1. % long is rising: the crowd keeps buying as price falls.
  2. Price rallies into strong daily or weekly supply. That's your station.
  3. Plenty of track ahead: not in the last few yards before 90%.

HEADING NORTH: LOOK TO BUY

  1. % long is falling: the crowd keeps selling as price rises.
  2. Price dips into strong daily or weekly demand. That's your station.
  3. Plenty of track ahead: not in the last few yards before 10%.

AT THE BUFFERS: GET READY

  1. 90%+ or 10% and below is a terminus. It can't reach 100% or 0%.
  2. Stop fading the crowd. The return journey is next.
  3. Wait for the turn, then board at a strong level.

The one rule

We always trade with strong levels, never on sentiment alone. Sentiment tells you which way the train is going. The weekly or daily level tells you where to get on.

The line

Drag the slider to move the train. Heading south towards King's Cross means the crowd is buying. Heading north towards Edinburgh means it's selling. The crowd hops on mid-journey, and at every station some passengers get stopped off: those are the stop-loss probes, and their orders are the fuel for the move.

A full journey

Watch one trip from start to finish: the crowd buying all the way down, a station stop, the terminus, and the return journey.

Direction beats level

Two pairs, both 70% long. A level-only reader treats them the same. A train reader doesn't: one is heading south with plenty of track ahead, the other has just left King's Cross and is heading north.

Board at a station

You can be right about the direction and still get thrown off the train. Getting on between stations, in the middle of nowhere, puts your stop right where the next probe lands.

Five mistakes to avoid

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Trading the number on its own"80% long, so sell" is half a thought. Which way is it heading, and is price at a strong level?
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Fading the crowd at the buffersAt 90%+ or 10% and below there's little gas left. That's where the return journey starts, not where you pile in.
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Boarding between stationsRight direction, wrong place: the next probe takes your stop. Wait for weekly or daily supply or demand.
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Trading a train that's going nowhere48, 53, 49, 52, 50% long is a train shunting around York. No journey, no trade.
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Following the crowd's hot tipsThe crowd reads the same tips you do. That's exactly who is on the train.

Now ride it yourself

Crowd Express puts you on the platform with eight real-looking setups. Board, wait, or stay off, and see how the journey ends.

Play Crowd ExpressNext: stop loss clustersMore guides

See where the train is today

The QDB Sheet tracks retail sentiment across FX, indices and gold, with the start-of-day and start-of-week readings so you can see the direction of travel at a glance.

Get the QDB SheetFree weekly COT reportWatch the sheet videos

Educational only, not financial advice. Charts and sentiment readings are illustrative, written to teach the idea, not real data. Trading on margin carries a high level of risk. All guides · QDB Trading Desk