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Stock Market Index Indicators from Twitter

Market Indexes on Twitter

Index Relative Strength

Trade Followers computes index strength scores for several indexes and ETFs. The index relative strength page lists them in one view so you can compare their performance on Twitter over multiple time frames.

The ETFs listed (DIA, IWM, QQQ, SPY) are widely used as trading vehicles and as a result their scores reflect actions and opinions of traders. These actions tend to be shorter term in nature and can alert you to smaller moves in the market.

Investors and money managers more often tweet using the index symbols (COMP, NDX, RUT, SPX). As a result, the strength scores for these symbols show sentiment over the intermediate to long term.

In the chart above you can see an example where market participants had doubts about small capitalization stocks making a larger term top. This is based on tweets for the Russell 2000 Index using the symbol RUT. During the same time period traders tweeting the symbol IWM for the small cap ETF were positive over time periods less than a month, which signaled they were buying the dip.

When money managers are rotating from small capitalization stocks to large caps the relative strength list will show DIA and SPX with higher strength scores than RUT and IWM. Rotation from large caps to mega caps is indicated when DIA shows high relative strength. When NDX, COMP, and QQQ are leading it suggests investors and traders favor technology.

The list can be sorted by time frame by pressing the frequency links in the menu bar (i.e. 1 Day, 1 Week, etc.). A quick way to see what happened in the market each day after the close is to look at the Index Strength scores for one day. Sorting by longer time frames helps to identify trends.

Twitter sentiment for Nasdaq 100 - QQQ

Market Sentiment Charts

More detailed information about sentiment and momentum on Twitter for the indexes can seen by clicking on the index name or symbol. This will show a detailed chart with daily and 7 day momentum. The trend of 7 day momentum can be used to signal short term changes in the direction of the stock market.

When the trend of sentiment changes it indicates the herd is turning and signals long and short opportunities.

The detail charts can be used to gauge the difference in sentiment between traders and investors as well. The NASDAQ 100 index ETF chart (QQQ) provides an example where you can see traders quickly buying and selling a market rally in December 2014. This pattern indicates chasing and often leads to instability.

Twitter Warning for Stock Market During the same time period longer term investors tweeting the symbol NDX for the NASDAQ 100 Index were concerned about a building stock market top. This is indicated by 7 day momentum falling while the index was rising.

Trade Followers tracks sentiment and momentum on Twitter for over 650 stocks and the following indexes and index ETFs.
  • Dow Jones Industrial Average SPDR ETF - DIA
  • CBOE Volatility Index - VIX
  • NASDAQ 100 Index - NDX
  • NASDAQ 100 PowerShares ETF - QQQ
  • NASDAQ Composite Index - COMP
  • Russell 2000 Index - RUT
  • Russell 2000 iShares ETF - IWM
  • S&P 500 Index - SPX
  • S&P 500 SPDR ETF - SPY
We do weekly updates about various market indexes on our blog about the stock market on Twitter.

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