The S&P 500 index has closed above its five-day moving average for 20 consecutive days, as it has repeatedly reached record highs.
That achievement has occurred only three times in the past 20 years. So it sounds great for stocks, right? Not exactly, Jonathan Krinsky, chief market technician at MKM Partners, tells CNBC/Yahoo Finance.
On each of those three occasions the S&P 500 dropped an average of 3 percent in the following four weeks.
"The ascent of the [recent] rally has been rather remarkable," Krinsky says, with the S&P 500 soaring 12 percent from its Oct. 15 low to 2039.82 at Friday's close.
Now, "we’re pushing against a pretty good area of resistance around 2,040," Krinsky says. If that resistance holds, he expects the S&P 500 to fall back to 1,970-1,980, or 2.8-3.3 percent.
To be sure, that's "nothing too concerning," he said. “But risk-reward from this level seems to favor the downside."
Both the S&P 500 and Dow Jones Industrial Average stood well within 1 percent of their all-time peaks Friday. Experts have mixed outlooks for the future.
"Retail sales were good, [rising 0.3 percent in September], and the preponderance of the evidence is we’re continuing on the path we’ve been on which is an improving economy," John Fox, director of research at Fenimore Asset Management, told Bloomberg.
"All those great things are no secret, though, and that’s priced into stocks right now. The thing that gives me pause is valuations."
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