The bulls have had a great run since the May lows were established, rally 170+ points off of those lows.

Much of the rally can be attributed to a few strong days that sent the market soaring higher, while much of that time was confined to sideways trading. 

Not unusual… just the facts. 

And the rally may continue moving higher in the weeks ahead, but there are some glaring signs that tells me to tighten those stops and be ready to books some profits when when the time comes.

First and foremost is the SharePlanner Reversal Indicator – this thing has really served me well over the years, and continues to do so. We are sitting at bullish extremes, and a bearish reversal signal either next week or the week after, is very likely. Now, such a reversal will mean either we are going to consolidate or sell-off. Most recently it has meant the latter, leading to steep, multi-week sell-offs the last two times. So caution is definitely warranted. And since Tuesday, I have not added any additional long exposure to my portfolio, as I await to see what this market decides to ultimately do here. 

Here’s the SharePlanner Reversal Indicator: