Market Tops: – Is the Market Topping Out ?

Both the S&P 500 ETF (SPY) and Nasdaq 100 ETF (QQQQ) are trading near the upper trendline of a rising 8 month price channel and appear to be overbought.
SPY has stalled near the upper trendline during the last two weeks while QQQQ reached the upper trendline last week. It is very likely that we will now see a pullback or consolidation.

This current overbought period is the longest since July-August, when RSI [lower BOX] was above 70 for over two weeks and was then followed by a period of choppy trading (yellow) and a subsequent advance to new highs. Pullbacks pushed RSI just below 50 and ended when RSI crossed back above 50 (green arrows). The must-hold area for SPY is 117 to 117.50 and for QQQQ 47.25 to 47.75.

Charts courtesy of StockCharts.com Newsletter