There's nothing wrong if you are long stocks at this time, as the market continues to want to trend higher and, as an investor or trader, you want to ride this upside wave. However, you should also be careful due to a technically overbought condition and the absence of any sort of correction. The reality is that markets cannot go up without a pause or correction. It will happen at one point.

At this juncture, the S&P 500 is holding above 1,150; if the index can hold, there may be a move towards 1,200, last encountered on May 3. The DOW is hovering around 11,000, and has rallied to the point where its 50-day moving average (MA). It is also back above its 200-day MA and showing another bullish "Golden Cross." On the NASDAQ, the 2,400-point level is a key level. The small-cap Russell 2000 is also trading above 700. Breadth and sentiment remains bullish.

The near-term technical picture remains bullish, but watch for some selling pressure due to the overbought condition.

Investor sentiment continues to be bullish on the NYSE and recently towards the NASDAQ. The trend of the NYSE new-high/new-low indicator had been edging higher, with 65 of the last 69 sessions bullish. In the technology area, investor sentiment on the NASDAQ has been mixed since May 6, but the past 27 straight sessions have been bullish. The near-term trends are positive.

On the charts, a "Death Cross" continues to be in effect on the NASDAQ, S&P 500, and Russell 2000, in which the 50-day MA is below the 200-day MA.

Overseas in China, the benchmark SCI closed up a strong 3.18% on Friday to above 2,900, and is eyeing a target of 3,000. The SCI is down 9.34% on the year, which is encouraging given that the index had been down over 25% earlier in the year. I remain bullish on China. Take dips in Chinese stocks as an opportunity to accumulate shares.

My near-term technical assessment is as follows.

NASDAQ

The near-term technical picture is bullish with above-average Relative Strength (RS), so there could be additional upside moves in the near term. The index is holding above the chart top at around 2,320 and 2.400. Market breadth has been edging higher.

The NASDAQ is above 2,400, its 50-day MA of 2,277 and 200-day MA of 2,292. Be careful, as the 50-day MA remains below the 200-day MA. The index is overbought.

DOW

The near-term technical picture for the DOW is bullish, as is the RS, so watch for more gains in the near term. The 50-day MA on the DOW is above its 200-day MA, which is a bullish sign. The index is overbought.

S&P 500

In the broader market, the near-term technical signals for the S&P 500 are bullish on above-average RS, so there could be more gains.

The index is above its 50-day MA of 1,114 and 200-day MA of 1,120. The index is also holding above its chart top at around 1,130 and a key level at 1,150.

There is key support around 1,040 on the chart. Be careful, as the 50-day MA is below its 200-day MA. The index is overbought.

RUSSELL 2000

The near-term picture for the Russell 2000 is bullish on above-average RS, so there could be more gains. The index trades with the economy. It is not a surprise to see the Russell 2000 up nearly 13% this year, as small-caps have historically outperformed after a recession ends. The index broke above 700 last week for the first time since May, and it is above its 50-day MA of 647 and 200-day MA of 653. The index is overbought.