Stocks gapped higher again and did nothing the rest of the day. You have to love it. Volume levels were pretty weak today in the QQQ and the S&P 500 e-mini’s. You have to think at this point; these overnight gaps are directly tied to the positioning or fine-tuning of hedges going into next week.

The big open interest levels in the S&P 500 remain down at 4,000, 4050, and 4,100. There is very little, if anything, above 4,100, even when we look into May. It suggests it will be hard for the S&P 500 to push meaningfully above 4,100 while indicating the index is likely getting ahead of itself.

But anything is possible; S&P 500 futures are already trading higher tonight, after the close on no news. Clearly moving in ahead of Frenzy Friday when everyone gets long over the weekend for the Manic Monday gap higher.

(Click on image to enlarge)

Make no mistake; the S&P 500 is overbought, it doesn’t mean it can’t stay overbought. The RSI on the S&P 500 is now just about 70 while trading above its upper Bollinger band. It is what it is, whether you think the market is going higher or not, just realizing where the market is critical.

(Click on image to enlarge)

VVIX

The CBOE VIX Volatility Index (VVIX) was up 3.7% today and moved back over 100. This is always important to pay attention to because it can lead the VIX to move higher. Again, one day may not matter much, but string together a couple of days, and you might want to buckle up.

(Click on image to enlarge)

I know you wonder why I care so much about call volume, but it does seem to ebb and flow with the S&P 500 index itself. Right now, call volume is diverging from the S&P 500 by a wide margin. Anyway…

(Click on image to enlarge)

Speaking of divergences, we now see inflation expectations starting to move lower. On a few occasions when these inflation expectations fell as the S&P 500 rose, it resulted in the S&P 500 following.

(Click on image to enlarge)

Adobe (ADBE)

This is Adobe’s fourth attempt to get above resistance $500. It just seems like the timing couldn’t be worse for it. The RSI is nearly at 70, and the stock is overbought based on the Bollinger band. Does that mean it can’t break out and push higher, no? Of course, it could break out. However, it doesn’t seem favorable at the moment for a breakout to occur.

(Click on image to enlarge)

Square (SQ)

Square is doing well, and even the RSI has turned higher. There is a gap to fill at $267.

(Click on image to enlarge)

Peloton (PTON)

Peloton looks decent currently. With its next level of resistance at $127.50, the RSI is turning up a push above that, and it could even move up to $139.

(Click on image to enlarge)

PayPal (PYPL) may even have a bit further to go before filling a gap at $268.50.

(Click on image to enlarge)