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Among the many terms introduced to us during the age of social media is a “thread.” That’s a series of connected posts, which people use to turn a short burst of information into more of a story.
For someone who grew up way before the social media age, it is ironic to me that a 15-year-old exchange-traded fund (ETF) dedicated to tracking social media stocks is, in technical terms, hanging by a thread. The ETF is GX Social Media ETF (SOCL). And lately, it is showing signs of turning itself off to profits. Let’s examine the possibilities ahead.
This is a risky chart, but one that is still, as noted, hanging on. The PPO indicator at bottom is at the bottom of its historic range. That’s the thread I’m pulling to try to make a bullish case here. But seeing the main price portion of the chart on top, I see a broken 20-day moving average, and a 200-day that just joined it. That’s a headwind in my book.
I normally look at weekly charts to see if I’m missing something in my assessment of the daily view. Nope, not in this case. SOCL is making a beeline to $40 or lower, if this trend continues. The weekly 20-period average is busted, and the 50-week, a longer-term indicator, has just joined it. Bounces can occur, but a wholesale turnaround is not likely here. Always possible, but not likely. This has “sell the rallies” written all over it.
My ROAR score analysis of SOCL indicates that, other than a brief bullish tease during the first couple of weeks of 2026, this ETF has been a longshot to produce portfolio profits since peaking at $60 in October. It closed Monday below $49.
What Are Social Media Stocks?
Many of SOCL’s top holdings are a set of familiar names to tech investors — and to social media users. The ETF has about 50 stocks, but only 10 of them account for more than two-thirds of assets. Still, this is a well-constructed basket for those trying to identify the stocks of companies around the world that are positioned as top social media outlets.
Why Are Social Media Stocks Falling?
A primary driver of the slide is the increasing regulatory and legal risk facing the major companies within the fund. Social media giants are currently embroiled in a wave of personal injury lawsuits in both state and federal courts, particularly in California.
These cases allege that addictive platform features have caused harm to the mental health of younger users. Recent settlements by some companies have left others heading to trial, creating a climate of significant business risk and potential liability. Additionally, new global regulations aimed at countering the sharing of unauthorized artificial intelligence (AI)-generated content on social platforms have introduced complex compliance requirements.
The industry is also facing a shift in user behavior and advertising trends that is impacting revenue expectations. Consumers are increasingly reporting social media fatigue and are actively seeking more authentic human resonance over the deluge of AI-generated content that has flooded major feeds.
This shift has forced marketers to reconsider their old social playbooks, leading to a rise in niche and community-first platforms that may not be fully represented in the concentrated top holdings of the fund.
Traders need to closely monitor whether this ETF can find support, technically and through the court battles — or if the current downward momentum will continue as the legal and regulatory landscape evolves throughout the remainder of the year.
Rob Isbitts created the ROAR Score, based on his 40+ years of technical analysis experience. ROAR helps DIY investors manage risk and create their own portfolios. For Rob’s written research, check out ETFYourself.com.
