Short-term trend (DAILY CHART) – BULLISH: It was a shortened week, but SPX rallied from 4514 to 4559, a 45-point advance. That's nearly a month of rallies, as reflected in the daily chart. It's up, up, and away at the moment. If you look at the daily chart, the market seems unstoppable, at least for now. Note: Stock market opened flat on Monday morning.
Long-term trend (WEEKLY CHART) – BULLISH: SPX is still strongly above all three major moving averages and still pointing higher. All systems are go.
MACD (DAILY) = BULLISH. MACD is well above the zero line and above the 9-day signal line. It appears unstoppable.
RSI: (S&P 500) = 71.55 (DAILY) EXTREMELY OVERBOUGHT. RSI is telling us that SPX is extremely overbought. As you probably know, markets can remain overbought for long time periods before reversing. No one knows when SPX will reverse, but that day is coming.
Comment: As mentioned above, the indexes are overbought and will reverse, but no one knows when. It is common for year end rallies, so don't be surprised if the market get even more overbought. On the other hand, I hate to sound so obvious, but the market is playing with fire right now, as we are in the danger zone.
The indexes seem unstoppable right now but anything can happen to reverse the upward momentum. For example, there is one more Fed meeting in mid-December. It will be interesting to see if the Fed (aka Chairman Powell) will put on the brakes or "let it ride." Either way, they appear to be in a tough spot.
If you have made gobs of money this year, it wouldn't hurt to take some off the table and sell. If you're dollar-cost averaging into index funds, stay the course as the strategy is working. Either way, good luck as we approach the holidays.