Yes, they definitely can sense what's going on in your life. Our Border Collie Patch knew when I was angry with him, and he had a funny trick of going to hide under the table. Problem was, it was a glass topped table, and we could see him 'hiding!' that used to make me laugh, and forget why I was angry, and as soon as he saw me laugh or smile, he'd come out for a cuddle.
Patch was everybody's friend, but there was one particular acquaintance I took an instinctive dislike to. Although I was always polite to this person. Patch must have sensed something in my demeanour, because he wouldn't go near him, and if he tried to stroke the dog, Patch would back away and growl.
