Traders on Twitter have been chasing every price movement and every change in the Greece situation for the past few weeks. This is causing quick moves from extremely overbought to extremely oversold readings on the 7 day momentum and sentiment indicator for the S&P 500 Index (SPX). When this occurs it creates an unstable market that could fall quickly if everyone starts running for the door. It appears that this week the market will continue to be driven by news out of Greece and the EU. Once that settles out I’ll be looking for a new trend in 7 day momentum to confirm the direction of the market.

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Support and resistance levels posted by traders on Twitter are mostly inside the current range. Below the market support comes in at 2040 for SPX. Above current prices the bulls want to see 2100 recaptured, then show resistance at the old highs near 2140.

Sector sentiment got cautious last week with negative readings in the leading sectors and positive readings in the defensive sectors. This indicates investors are adding some defensive stocks to the portfolio.

Breadth calculated between the most bullish and bearish stocks declined a bit this past week, but overall is still healthy.

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Conclusion

Greece is dominating traders actions and causing chasing which leads to instability. Some caution is prudent until the situation is resolved. Then we’ll be watching for a new trend in 7 day momentum.