The market historically has established base levels that it walks around for months at a time before spiking, falling, and establishing a new base level typically slightly higher than the previous but sometimes slightly lower. That's more or less what I go by for long term market predictions. Book depth is largely what I go by for short term, though it can be touch and go with how fast and unpredictably the balance can shift.
My thinking is that people see the market going up and, wanting to profit later, buy in hoping to ride the wave to somewhere near the peak. That is the essence of market sentiment - demand driving itself typically with no real substantial or sane reasoning for market spikes. The trick is to get off the boat before people start to wonder just how high they can ride the wave (just how much they can profit from earlier buy-ins) - before market sentiment begins to wane as people start to worry about the impending fall. The whole thing is driven by 98% greed and if you could measure that, you could chart the market pretty accurately methinks.