After watching more price action come in this week, 2018 is shaping up to be the most likely analog we’re tracking. That said, it feels like SPY is headed to $700 before August. And mathematically, it’s possible—just 18 more days in a row like Thursday’s 0.75% gain to make it happen!

In this kind of relentlessly bullish environment, dips remain buyable, however large dips are starting to feel like myths—like Bigfoot or a trader who’s never taken a loss. When sentiment is this strong, trailing stop higher is a great way to stay in the trend without selling out too early.

Right now, $600 on SPY and $591.80 are the two key support levels I’m watching along with the pink trendline that is acting as support. As long as those hold, I’m expecting more "higher for longer." If we break below the trendline or either key support, that’s when I am expecting the actual retest to begin. Until then, it’s an “up only” summer.

SPY

In Thursday’s RLT Newsletter, I laid out the case for why QQQ looks like it's repeating the pattern we saw from December 2023 through March 2024. That pattern lasted 80 days until it peaked—right now, we’re only about 42 days into this new channel. If the setup plays out again, that means we are only halfway though, with a potential target around $570. As long as QQQ holds $523.50, the bull march higher is intact. A close below that level could mean a retest of $500 or lower.

In summary: long is strong. As long as we hold key supports, the trend is your friend. If you're looking for signs of a coming pullback, I’ve got a few. But if you’re looking for reasons why the market will keep going up forever, just research the projected rate of currency debasement over the next decade. Zoom out, extend your time horizon, and you'll see why "up and to the right" remains the long-term game—so long as the money printer stays plugged in.

QQQ

Signs We May Be Nearing a Short-Term Peak

• Bearish Divergence on RSI
  We now have three higher highs in price paired with three lower lows in RSI. This signals a slowdown in bullish momentum. It’s not inherently bearish, but it does suggest the bulls are losing some steam. We saw this same divergence back in 2018—it took 80 days before it finally broke down with an 8% correction.

• Falling Volume Since the May 12 Gap
  As we’ve continued to grind higher, volume has declined. That, combined with weakening RSI, signals this move could be running out of juice.

• Breadth is Narrowing
  Fewer and fewer stocks are participating in the rally. Fewer than 50% of names in the S&P 500 are above their 200-day moving averages, even as SPY pushes higher. This means the big names—MSFT, NVDA, AVGO, META, JPM—are doing all the heavy lifting.

This narrowing breadth usually resolves one of two ways

• The laggards play catch-up, leading to broad market rotation higher.

• Or the leaders finally pull back—and everyone drops together.

Which scenario you think is going to play out really depends on your 2–3 month outlook.

• RSP Still Lagging
  The equal-weighted S&P (RSP) isn’t making new all-time highs, and it’s showing bearish divergence on its recent moves. Yes, it’s now above its long-term daily moving averages—which is a win for the bulls—but it’s still trailing behind the cap-weighted index.

S5TH

What’s Next?

SPY looks set to break into new all-time highs on Friday, with a short-term target zone between $616 and $629 over the coming weeks. If we then see a breakdown below our key SPY and QQQ trendlines, get ready to buy the dip at the levels we’ve outlined:

• SPY first key support: $575

• QQQ first key support: $495

Until then, stay bullish, trail your stops, and keep your eyes on those key pivot levels.

Bitcoin Post Script

What would a Market Milestone be without a Bitcoin update? Incomplete—that’s what.

However, don’t expect me to write weekly updates on BTC during the depths of crypto winter. I’ll be far too busy garage sale-ing all my belongings to buy every last satoshi possible… and crying myself to sleep each night for not selling at the exact top so I could rebuy the exact bottom like an absolute legend.

Anyway, BTC isn’t making new all-time highs alongside the market just yet. It’s only about 4% off, so not a dramatic divergence, but still notable. It’s lagging a bit right now.

Currently, I have three main counts for Bitcoin:

• Orange and Green counts: These both suggest further dips into the mid to low $90Ks. If that full correction plays out, it could develop into face-ripping bullish moves to close out the year.

• Blue count: This count has BTC’s low in with it breaking out soon and heading toward Target 1. It’s the less bullish scenario, still solid—but by Bitcoin standards, a tepid end to the bull run.

Whichever way this resolves, BTC still looks poised to head higher in 2025. If we dip first, I’ll be a buyer in the green box.

BTC