comments and outlook for 06-08-2011

Not exactly the day I envisioned with the gap up at the open.  The market then traded in a fairly narrow range until the last hour.  By the time our buddy Ben started his press event the market was barely positive.  By the time he finished it was red.  So we got out attempt at a rally and it was fairly minor as I speculated any rally attempt would be.

By the close though it appears the longer cycles (1 year hard down, 20 week down and 22TD down) had again taken control.  IMO this puts the bulls back on the defense.  Given we closed at or near the lows we easily could get some weakness bleed over into the open tomorrow. 

Looking at the short cycles (the longer cycles mentioned above are all down) - the 11.2TD day cycle is still up, the 5.6TD cycle is down, and the 2.8TD cycle tops mid day.   So in trying to imagine how this is likely to play out I think a likely scenario is gap down at the open, spend 2-3 hours filling the gap and down the last half of the day.  So I would expect a challenge and breaking of the 1278 level, but not a major sell down.  Of course news could always lead to a bigger sell down than I expect.

Here is a visual:

GL traders.  Be careful there may be a bear in that tree outside your window.  Hehehe