One of my main concerns over the last few weeks has been the possibility of the markets topping out. Take a look at the charts below -- you will notice that all are showing signs of important trend breaks.
The SPYs have already broken their trend line.
The QQQQs are barely hanging on
The Russell 2000 has already broken its uptrend and
The IWCs have broken their trend line once, move higher and are now above that trend line again.
With the equity markets, it's incredibly important to remember there are several important averages. If one breaks a trend, it's important but if the trend break isn't confirmed by other averages, then it's not that big a deal. The reason is money flows between the markets on a regular basis. For example there is a fair amount of intra-equity market movement from say small caps to big caps and between sectors such as health care and technology. These intra-market movements can effect one average disproportionately. But when you see all the averages make moves, it's time take notice.