I agree that animals in general, and dogs in particular, can usually sense our emotions , and sometimes they seem to just pick up on our thoughts as well. My belief is that they can read the "pictures"in our mind as we visualize our thoughts. I am not sure if all dogs can read all people, but I do believe that some animals bond with their owners enough to do that. Some dogs seem more sensitive to our thoughts than other ones do.
My Chipper also listens to everything that I say, and you can see his little face trying to puzzle it out sometimes when he is not sure what I am talking about. But if I say the B-word (bath), then he is headed for under the couch to hide.
Sheba, my Pommie girl, was just as smart as Chipper, but was not "tuned-in", and she ignored everything unless she heard her name mentioned, and then her little head popped right up, and she started listening.