Social media breadth continues to paint a negative divergence with the S&P 500 Index (SPX). The divergence from breadth calculated from the Twitter stream is a result of the number of weak stocks rising and the number of strong stocks falling. The increase in weak stocks started in early February and the decline in strong stocks began at the first of March. This pattern indicates the stocks that were beat up over the past few months aren’t recovering enough for traders on Twitter to make consistent positive comments about them.
The same general pattern is occurring on the StockTwits stream. Its divergence is a result of the number of strong stocks falling with a small increase in the number of bearish stocks.
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