comments and outlook for 05-23-2011

The outlook for Friday - not a good call.  It seems that expectations based on the shorter cycles are not being realized.  So this leaves me conflicted....  The short cycles should be up, but the market seems to want to go down.  To me this indicates that longer cycles (the 1 yr down leg?) are taking control.

So I am going to make a judgment call - I think we somewhat ignore what the shorter cycle are telling us and go with the evidence that they are being dominated by the longer term market cycle momentum.  I showed you on one chart in my weekly outlook where MFI was projecting a bottom at the point where the 22TD cycle should be topping.  I also think with the 1329 FIB (just below Friday's close) there is a better than even chance we break below that and if we do the market could easily fall to 1310...

The short cycles are up, but in my judgement the momentum is to the downside.  So that should give us a down market. Probable some time during the day the bulls push  up, but the bears win the day. Keep in mind the 1 yr should be hard down at this point and the 20wk has topped or is ready to top.  In short more volatility with a down bias.

Here is a visual of the shorter cycles:

GL traders.  Do your own analysis.  I can and have been wrong before - and it was difficult to make a call in predicting the action for Monday.