[Joey]

Hey everyone,
I have been skeptical about how much influence tweets and posts could have on stock prices, but I am increasingly thinking it could be surprisingly impactful.
I recently noticed a sudden spike in positive sentiment on social media, which was then quickly followed by an uptick in the technology stock’s price.
Does anyone here already incorporate social media sentiment analysis into their active trading strategies?
Do you have any specific tools or techniques that you find particularly effective? I’ve seen a fair bit online about a service called TweetDeck.

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Topic

[Christian Harris]

Retail traders on social platforms like Reddit and Stocktwits can influence stock prices, but almost exclusively with meme and penny stocks.

Prominent individuals with large followings, such as Elon Musk, can also cause substantial price movements with their posts.

An example includes Tesla’s stock reacting to Elon Musk’s tweets and the volatility in the Dogecoin cryptocurrency driven by Musk’s social media discussions.

Reddit’s WallStreetBets has shown that coordinated buying or selling by a large group of retail investors can significantly impact stock prices, as seen in the GameStop (GME) short squeeze.

While social media can amplify news that might otherwise have a limited impact, it’s important to remember that not all information is reliable. Always approach social media’s influence on your trading decisions with a healthy dose of caution.

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[Dan Buckley]

It’s influence is most impactful for smaller stocks. For markets like oil, Treasury bonds (huge markets), social media sentiment’s influence is virtually nil.

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