Wall Street spent the first half of this week printing all time highs like its going out of fashion and honestly the whole thing feels a bit detached from reality at this point.. the S&P 500 closed above 7,600 for the first time ever on Tuesday hitting 7,609 which was its 24th record high of 2026. The Dow Jones tagged 51,300 and the Nasdaq pushed through 27,000. All three indices at records on the same day and nobody even blinked. Nvidia kicked it all off Monday surging 6 percent after launching some new PC chip and dragging Dell and HP up 10 and 8 percent respectively. Marvell went absolutely mental on Tuesday up 33 percent after Jensen Huang gave them the nod. AI infrastructure is basically the only game in town right now.

Then Wednesday happened and the cracks started showing. Nasdaq dropped three quarters of a percent while the Dow actually rose over a percent which tells you everything about whats going on under the surface.. proper rotation out of chip names into banks healthcare and retail. Thursday doubled down on that theme with Broadcom cratering 15 percent after missing AI revenue forecasts and suddenly everyone remembered that not every semiconductor company is Nvidia. The Dow ripped 900 points higher to a fresh record led by UnitedHealth and JPMorgan while the Nasdaq slipped again.

The technicals are getting properly stretched now. RSI on the S&P is sat at 75 which is well into overbought territory and the forward PE is around 23 times versus the long run average of about 18. Deutsche Bank pointed out that the S&P gained 16 percent across April and May which has only happened four other times since World War Two.. the last time was right before the 1987 crash which is a fun comparison nobody wants to hear. The Shiller PE ratio is at 42 and a half as well which is basically where it was before the dotcom bust.

The concentration issue is mad too.. Nvidia Micron and Alphabet alone account for over 40 percent of the years earnings revisions on the S&P. Schwabs midyear outlook wasnt exactly cheerful either flagging rising energy costs negative real wage growth and weak consumer savings. Jobs data drops Friday and if it comes in soft with oil still above 90 a barrel thats the stagflation setup nobody wants. Support wise the 50 day moving average sits around 7,100 and the 200 day is down at 6,840.. thats a long way below if this thing rolls over.