During his discussion with CNBC's Mike Santoli, deGraaf explained how the conditions that usually mark a top in the stock market are happening right now.
DeGraaf is the best chart analyst on Wall Street over the last decade, according to Institutional Investor magazine. He was formerly the head of the investment policy committee at ISI Group.
"When the market becomes so concentrated, that's the point when you start to develop a sort of top formation," he said. "The soldiers, if you will, are starting to fall off and you've just got a very few select names that are driving the market higher."
And deGraaf explained why technical analysis works.
See the full video below.