The fact that $SPX and the Dow ($DJX) are out-performing just about everything in the universe is well-known, but there doesn't seem to be any letup in the wide divergence between market internals and $SPX. If $SPX falls back below support and closes below 4690, that will remove the "bullish" status from the $SPX chart. There would still be support at 4500, which is the lower end of that trading range.
Equity-only put-call ratios have even begun to waiver. They have been on buy signals since mid-to-late December, but in the past couple of days there has been heavy put buying. That has caused both ratios to rise slightly. The computer analysis programs "say" that they are back to sell signals.
Market breadth has been deteriorating badly, even while $SPX was making new all-time highs. Both breadth oscillators rolled over to sell signals as of January 5th.
$VIX has reluctantly risen while $SPX has fallen over the past couple of days. $VIX rose enough to return to "spiking" mode and it also climbed back above its 200-day moving average, which creates a new $VIX trend sell signal.
In summary, the bulls are trying to keep $SPX from slipping back and closing below 4690. As long as they can do that, the $SPX chart is bullish and the bulls have a chance to retain control. Otherwise, the bears are going to get their chance.
This Market Commentary is an abbreviated version of the commentary featured in The Option Strategist Newsletter.