
For the past few months Twitter sentiment for the ETFs that track the Nasdaq 100 Index (QQQ) and the Russell 2000 Index (IWM) have been painting a pattern that shows indecision by traders. Each move up in price is met with high sentiment and each move down garners a lot of negative tweets. This is causing our smoothed Twitter sentiment indicator to mirror price. When sentiment mirrors price it shows us that traders are chasing. Their tweets are reacting to price rather than predicting it. Smoothed sentiment for QQQ and IWM are currently showing very wide swings from bullish to bearish. This uncertainty is not a normal condition for actively traded and tweeted stocks. Instead, as momentum builds for a stock, Twitter sentiment starts to trend with the stock in a well defined range. Traders show confidence in their positions with a majority of tweets confirming the trend. In up trends, down days don’t show large negative prints in daily sentiment which helps smoothed sentiment continue to rise (and confirm
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