While the market has pushing up quite nicely for now and it certainly appears very possible that SPX wants to challenge the 4300 soon, it has become an increasingly a warning sign that the underlying breadth is diverging and trending down.
Tech stocks have had an outstanding year, especially the big ones. According to Bloomberg calculations, a handful have accounted for all the gains this year in an index mimicking the S&P 500.
The table below shows, in descending order, how many points and percentages of the index's move were accounted for by the top stocks. If Amazon is included as a "tech" stock, they more than make up the index's total gain for the year.
The million dollar question is whether this bullish trend is sustainable. For sure the chance of a major crash is unlikely for the moment, but the upside potential is also limited as well when the breadth is poor. I highly doubt we will see much above 4300 even if we get there.
