The stock market, as measured by the Standard & Poors 500 Index ($SPX), sold off for a couple of days and then rebounded quickly to new all-time intraday and closing highs. However, sell signals and overbought conditions abound, so all is not bullish.

With $SPX making new all-time highs, its chart is bullish, and the trend of the market is higher. Price is the most important indicator. That has not changed.

Both of the equity-only put-call ratios have rolled over to sell signals. The weighted signal was confirmed a few days ago, and now the standard ratio has joined in.

Market breadth has been bouncing back and forth with the market, forcing the oscillators to move into and out of sell signals. As it stands at the moment, the NYSE-based breadth oscillator is on a sell signal, while the "stocks only" is not (although it is very close to one). indicators. Volatility indices spiked up last Monday, but then have settled back down at low levels. As such, volatility remains in a bullish stance as far as the stock market goes.

In summary, the trend of the market is up, and as such it must be respected. Hence the intermediate-term outlook remains bullish. However, with sell signals from breadth and equity-only put- call ratios, there is certainly danger of at least a sharp, but perhaps short-lived correction. With seasonality being as bullish as it is, it is much more likely that any such correction would occur very soon or not until after the New Year.

Lawrence G. McMillan is the author of two best selling books on options, including Options as a Strategic Investment, and also publishes several option trading newsletters.