SPY saw a false breakout this morning and then came right back below resistance to close the day just barely in the red. These are some of the signs I like to see before markets top. Among others, another one I look for is overbought MFI. I use MFI because it accounts for volume and price rather than just price (RSI). It hasn't worked well over this recent rally, probably due to the indirect liquidity injection through the BTFP, but it's bound to come back to equilibrium. Markets always do. There have been 4 overbought signals between November 1st and today on the 4h chart (6 if you include extended hours), and 2 on the daily chart. These overbought conditions almost always lead to a retracement lower, if you can time it right.
My first area of interest for a pullback is 458, but I suspect we'll plunge lower than that as bulls come in the continue buying the dip. A better area would be around SPY 440, but I suspect a bounce would take place before that occurs. With it being an election year, the market can drop 10% and still be in a historically "strong" place. When Biden took office, SPY was at 385 and QQQ was at 323. A lot of people suspect that the markets will rally from here into the election, but this is one scenario that I think traders aren't thinking about. That said, I am by no means trying to forecast, only offering counter-points as the broad narrative is almost always wrong.
Tomorrow I'll be watching the same range from my briefing last night: resistance at 501.65 and support at 498.53.