Key Understandings
News sentiment vs trader sentiment
- News sentiment is a big data / alternative data set derived from the vast volume of news published related to the financial markets and key themes affecting them e.g. Brexit, Trump
- Trader sentiment is a small data set derived from client positions.
News sentiment often precedes market movement
- By knowing what the sentiment is now, users can pre-empt how the market might react.
News volume is a proxy for market volatility
User Benefits
- Turns infobesity into an advantage - by turning millions of news articles into valuable market insights.
- Unique market insights which are only achievable using AI technology.
- By understanding current market sentiment traders can better anticipate market reactions.
- Data visualisation - intuitive, engaging tools to aid decision making and confidence.
- MT4 EA - research and trade within your own MT4 for faster execution
- Better entry / exit planning with better awareness of market state, key events and historical pattern analysis.
- Professional news, commentary and analysis from Dow Jones
- Hourly / Daily data to suit trading styles.
- Multi-asset
Research Terminal Components
Asset Picker
What is included and how it works
News Sentiment
News sentiment is calculated using a lexicon-based algorithm that is able to extract 9 sentiment types (emotions), 2 further metrics based on the volume of news received and 1 additional identifier based on entity recognition from News Text.
It can either work on Dow Jones News Data, or Open Web News Data. The data is generally the same, but the access requirements and permissions are different, and therefore there are different price points for the access of the data.
Sentiment Radial Gauges
This is the ratio between General Positivity and General Negativity (Positive and Negative Sentiment Scores). Also known as the “Feel Good Factor” in our sentiment types.
In Research Terminal Gauges we use the Open Web sentiment.
How to Read the Sentiment Radial Gauges
Sentiment is moving more bullish. This has doubled since its last reading.
Sentiment is moving more bearish. This has almost doubled since its last reading. The current reading is nearly 100% bearish news sentiment. Bullish / Bearish
- How positive / negative the global media is feeling towards the asset
- This is expressed through the millions of news articles that are analysed using Acuity’s NLP technology on a daily/hourly basis
Sentiment Trends
- The arrows in the circles indicate the direction the sentiment data is moving in.
- Understand how the data has changed since the last reading by the darker green/red arrows.
Time stamp in the middle
- This is the countdown until the next Macroeconomic or Corporate event that affects this asset.
- The bars indicate the expected volatility level associated with this event.
News Volume
Normal (average) News Volume and Fear Index levels towards Meta Platforms, Inc. (formerly known as Facebook)
Normal (average) News Volume and slightly higher than average (~20%) Fear Index levels towards Silver (commodity)
~40% higher than average News Volume and 100% higher (or more) Fear Index levels towards Silver (commodity)
- News Volume: this is the amount of news that has been published in the time period (hourly / daily) compared to its normal average volume
- Fear Index: This is the amount of fear being expressed towards the asset. This can indicate wider market impacting events such as Coronavirus or Brexit for example.
- If there are no bars highlighted, this means that news volume is normal.
- High news volume indicates market volatility and therefore risk.
- News volume tends to increase leading up to and after a calendar event. This can be used to help traders time their trades to avoid coinciding with events.
Fear in this case refers to specific volatility related terminology, which is different (more specialized) than general/financial negativity (bearish).
Asset Selection
Users can select assets in 3 different ways:
1. By Popularity:- Default View
- Top 10 Most Popular Assets (selected by Acuity)
- FX Pairs (Currency Pairs)
- Commodities
- Indices
- Equities (Stocks or Shares)
- Coins (Cryptocurrencies)
- Extremely Bullish / Bearish are highlighted by a red or green background colour
Asset Details
News & Events
The Latest News section and the Next Calendar Item section can be used to provide richer information about the selected asset to a user.
Latest News
This section contains the latest news item covering the selected asset from the provider that is permitted for the user account in the dashboard. There are 3 options here at the moment:
The headline is clickable - clicking it reveals the full article text.
Next Calendar Item
This section contains the next closest Macroeconomic calendar event for the given asset. The following information could be included:
- Event Name
- Event Description
- Previous value, Forecasted value, Actual value for a specific economic indicator.
The Next Calendar Item is also subject to permissions restrictions. The data displayed here can either come from Dow Jones or FX Street.
Price vs Sentiment Chart
This section displays a chart that is plotting the correlation of the asset price and the news sentiment. The user can choose if they want to see Daily values or Hourly values using the switch at the top.
To generate the sentiment line, we use the Exponential Moving Average of the Feel Good Factor Sentiment (created using the ratio of Positivity and Negativity). The EMA is created with a 7 day lag.
The red and green arrows that you can see on the Price line are the Market Alerts. More information on them will follow.
Additional Tools
Market Alerts
- These are unique news sentiment driven indicators.
- These offer traders alternative trade ideas with a confidence rating and time frame so traders can plan entry / exit points.
- These are calculated using mathematical computations from historical sentiment and price data patterns.
- Users can filter by asset and by confidence rating / risk appetite.
The idea is as follows:
- We are monitoring when the Exponential Moving Average of the Feel Good Factor sentiment crosses the Simple Moving Average of the Feel Good Factor, either upwards (generating a Bullish event or Market Alert) or downwards (generating a Bearish event or Market Alerts).
- We look at the price data after each of these events, and provide an output of whether the price data was going higher or lower, what is the probability of it going up or down, and how long it was rising or falling.
News
The News section contains full news articles (the full text is revealed on click) that are governed by the same permissions as the news and calendar events in the main asset section (so either provided by Dow Jones, or FX Street, or ABM Financial News).
The user has an option of viewing asset related news only (for example only for EURUSD), or they can also view all news. The “All” toggle controls this.
Display and Filtering
Here is the breakdown of how the asset news is displayed depending on the selected option.
|
Toggle Setting |
News Article Count |
Duration |
|
All News |
50 |
3 hours |
|
Asset News |
50 |
14 days |
We either display the first 50 news about the asset or 3 hours/14 days of publication, whichever is first.
Here is the breakdown of how the news is filtered, depending on the provider.
Calendar Events
Calendar Events are retrieved either from Dow Jones or from FX Street. The following event data is displayed:
- Name of the event (for example, Non Farm Payroll)
- Event description (if provided)
- Time of the event
- Country associated with the event
- Expected Volatility associated with the event. The higher the expected volatility, the higher the potential price movement the result will cause. Generally, if the results are better than expected, then the price for the asset is expected to move higher, and if the results are worse than expected, the price for the underlying asset will usually drop.
Users can also filter the events using the following controls:
- Date/Time of the event. The following options are available:
- Recent and Next
- Today
- Tomorrow
- Next Week
- Volatility Filter. Users can only choose to see events of a specific expected volatility level.
If you haven't found what you're looking for yet, don't worry! Our team is here to assist you.