Maybe Not. From Reason:
For the first few years I had her, I was impressed by my late dog Harper's uncanny ability to assess people's character. She hated every crappy landlord and bad roommate. Barked at them. Snarled at them. Wouldn't go near them. But if I brought home a date I liked, Harper, a Shar Pei/Labrador mix, would curl up right next to the woman and turn on the charm. It took me several years to figure out that my dog wasn't a good judge of character; she was just good at reading me. She liked the people I liked and disliked the people who rubbed me the wrong way. For dogs descended from lines bred for protection and companionship, this talent makes sense. A dog adept at distinguishing friend from foe was likely to be kept around and bred, and one very good way to tell friend from foe is to read your master's body language.
My confusion about what was going on in Harper's head reflects a common misconception that is also apparent in the ways dogs are used in criminal investigations. When we think dogs are using their well-honed noses to sniff out drugs or criminal suspects, they may actually be displaying a more recently evolved trait: an urgent desire to please their masters, coupled with the ability to read their cues.
Several studies and tests have shown that drug-sniffing dogs, scent hounds, and even explosive-detecting dogs are not nearly as accurate as they have been portrayed in court.