We’re sitting roughly where we were last week with Twitter sentiment for the S&P 500 Index (SPX) still showing signs that market participants are ready to test the all time highs. 7 day momentum broke above its downtrend line as the market was moving out of the last low and has been able to stay above zero even as the market has fallen. This is a good sign for the bulls.
Breadth calculated from the most bullish and bearish stocks on Twitter continues to improve as the number of bearish stocks falls. This indicates that traders aren’t shorting this level. Instead, they’re waiting for a move before committing.
Support and resistance levels tweeted by traders on Twitter now show a large range for SPX with 2100 on the downside and 2200 on the upside. A smaller, and more recent, range is between 2120 and 2180. A break of the range is the most important thing we show watch over the next few weeks.
Sentiment is still projecting a move to new highs and is being aided by trader’s tweets. All the bulls need is a break above 2200 to start a rally that should continue into year end.