Last week I wrote a lot about sentiment and how it would take a few more days of giddiness early this week to get the sentiment indicators to where they were at previous tops. That still remains the case but there are other indicators that would support immediate downside.
A week ago, on Monday the 8th, the NYSE saw 470 new 52 week highs. By Friday, with the S&P 500 11 points higher there were only 436 new 52 week highs. That is a divergence that shows that some stock are starting to sputter. In addition, the market is very overbought. I use a 10 day moving average of NYSE Advancers - Decliners and below is the raw data that goes into the calculation. We will be dropping a string of 10 positive numbers starting with two very large numbers today and tomorrow.