May 5, 2014 weekly outlook

Last week continued to show some residual strength.  The Dow set new highs and most of the major averages were up around 1% for the week.  The market shows little evidence it is going up a lot or down a lot near term.  That is how tops are made, they bore investors into inaction.

Still our envelope analysis is on a sell signal from just over a week ago, so the market should continue sideways with a downside bias this week.  The one month cycle is up for the next 7 or so trading days.  The 2 month and 4 month cycles are down into the end of May.  The 8 month cycle is up and tops near the end of May (as a mid-cycle slump develops as 3 shorter cycles bottom),

In summary - minor weakness next week.  Here is a visual: 

GL traders.  I suppose a full on War in Ukraine could cause additional downside movement.  For now (month of May) I hold RWM.