Sentiment generated from the Twitter stream for the S&P 500 Index (SPX) is rolling over from below the zero line again. This usually means a sharp fall in price. The odds now favor another test of recent lows before a significant rally.

Breadth between bullish and bearish stocks on Twitter is showing a constructive pattern. During the recent rally we got a good increase in the number of bullish stocks. This indicates that buying is occurring in leading stocks. Keep an eye on this indicator (and the type of stocks in the 1 month bullish list) during this next dip. If it can hold up then I think we may be able to get a rally that makes it back to the 200 day moving average.

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