Well, he is experienced in human behavior, and knows your personality. He can almost predict what you will do or say. And he can know the future, but some of that is kept from him. Look at the story of Job and remember that he can do nothing without God's permission. Even you know by someone's actions if they are scared or happy or whatever, and in such ways even you can know what they are thinking. But can satan or demons exactly know word for word what we are thinking, or see the picture we see in our mind? I don't think so, but I don't know for certain at this time. But I think I remember reading that satan cannot know our prayer to God, he cannot hear it unless we say it aloud.
But satan can introduce thoughts to our mind- this is how things are taught by demons. A demon does not stand in the pulpit and teach lies, he whispers them to the mind of the human who then goes into the pulpit and teaches those lies, if indeed he listens to evil thoughts instead of dismissing them. When demon possession took place, it is my personal belief that they could control only the physical, but not the thoughts of the person possessed. And what about the mentally handicapped? I still believe that everyone starts out with a conscience, has a sense of right and wrong, and that every creature knows the Creator.