You can feel it, can't you? The Fear of Missing Out bulls are dragging the Recency Bias Bears further over the line in their tug of war game. I don't think they have even come close yet to pulling the big guy with the rope wrapped around him at the end over the line, but those little people at the front? They're being pulled.
I do think a higher high in the S&P 500 would be a decisive tug, however, enough to get the majority over the line. As we witnessed from Friday's decline, the Recency Bias Bears still have control of their rope for now.
But the biggest change in the market on Monday was not the move up or even breadth or any of the indicators. The biggest change was that the Bank Index relative to the S&P 500 finally crossed that two year downtrend line. I know the wait feels like forever, but it was only about 10 days ago we first started looking at this for signs of a crossing.

I think it's a big deal. When there has been a trend in place for two years and that trend has a change, it's best to pay attention.
Now let's look at the Bank Index itself. I prefer this to any of the exchange-traded funds, because it's a bit purer, but also because it's been around a long time, so we have plenty of historical data on it. You can see that it has tagged this resistance nine times in the last year. That's a bunch. If it can't break out, then we'll just have more of the same. But if it can breakout, what I expect would be is what I have drawn in blue. A breakout that gets everyone excited followed by a retreat to test the line. Then we'd see it shake out the weak holders and late comers.

One reason is the bonds. The yield on the 10-Year Note is pushing up against some resistance. Last week, I noted the 1.80% area, but I should couch it to 1.80%-1.90%. Even if the yield can cross that downtrend line, 1.90% looms as resistance. I'd expect a pullback in yields later this week, if just to work off the overbought reading that has developed.

Then there is the upcoming short-term overbought reading I expect in the market midweek.

Therefore it would not surprise me if we see the Bank Index break out right around the time bonds are getting a bit oversold (yields overbought) and the market in general is getting overbought. Surely a breakout in the Bank Index, and maybe the S&P, would get sentiment a little too giddy in the near term, pulling a few more over the line.
Now let's see if it plays out that way.