Is market approaching a top?

The general market SPX has been going up since August 21 for about 2 months now. Although it had rested two times (in which each lasted only 1 week) since then, this 2 month period probably outlasted the average 1 month rising period this year. There is no major sign of a market top at this point, as the SPX price continues to grind up and market distribution days are rare. However, the MACD indicator is showing losing momentum.

Based on the behavior of small upward daily movement of the SPX prices since last week, the indicators and the higher than average number of rising uptrend days, I'm preparing for the end game for this market cycle for my positional trades. Basically, it means watching stock prices closely with relatively tight exit points to take profits and waiting for a market rest before fully entering new positions. According to Mark Douglas's book titled "Trading in the Zone", one of the seven principles of consistency in winning stock market is "I pay myself as the market makes money available to me". This is similar to my posting before on winning altitude. Therefore, I need to take profits gladly for this market cycle, as a number of stocks in my portfolio gained within or beyond my expectations.

In general, the last 4 weeks were probably very good time for most traders, since the market kept moving up. All of my positions are doing well except a couple of them that got stopped out. The only bearish trade (HOG) that I entered while market gave some bearish signals ended as a loser as market resumed uptrend within a few days after my entry. The Indian stock ETF EPI was a biggest percentage loser in over 1+ year's trading for me. It was the worse case scenario in my stop rule if the stock kept gapping down for more than 2 days. Looking it at the probability point of view, one big loss trading is still OK as my winning and losing distribution is quite normal up to now. I'll present more statistics later.

I also closed two positions which were big winners last Friday. NFLX was doing well up to one day before the earnings announcement. My exit rule requires me to exit before earnings day to keep my P&L smooth. So I was happy to take the good profit percentage. PYPL reached my target area as the high of the day and retreated from there. Considering its earnings announcement is coming soon, I decided to take profit off the table.  The PYPL chart was posted on StockTwits and is shown below.

My other stock positions include BIDU and EDU. Their earning announcement days are coming next week. So I need to take them off soon as well.

The only new position I entered after the last post was the XLV June, 2018 $79 call for a cost of $5.88 on 10-2. I felt health care could resume its recent uptrend after some rests, if the market rotates to sectors that made less progress this year. So I bought the call after XLV rebounded from a major support level around $81 as shown in the chart below. However, it hit the prior resistance at $83 and started to retreat. I could have sold a short call as a hedge yesterday after a two day declines in a roll. But it was actually trading higher when I was watching the stock price yesterday. Since XLV shot up to form a new ascending triangle breakout today, I don't need to short the call any more.