Yesterday  I gave you my guestimate that this rally could last through June, or another 4 to 6 weeks.  But I know some of you like to look at the shorter term.  Are we due for a little pullback now, or will the market continue to climb the "wall of worry?"  Let's look at the market for the next week or two...

The market has shown a slight negative bias leading up to the Memorial Day holiday, then in typical holiday fashion, was positive the day immediately before and was weak the day immediately after.  The market has also shown consistent strength 3 and 4 days after this holiday.

Let's take a look at the historical seasonality data for May and June.  For the record, the seasonality information has been little help of late in predicting short term movement.  Hence, I haven't discussed it much lately.  But holiday information tends to be more reliable. 




                           Chart provided courtesy of www.sentimentrader.com

Historically, the last two trading days in May, and the first five of June tend to be stronger than average.  So judging by the holiday and seasonality information, the odds favor this Friday and next week as being the best days to be invested with this week, up through Thursday, the least attractive.  This Friday and next Tuesday are the 21st and 22nd trading days in May this year.  Again take this information for what it is, historical information.  It should never be used as a primary indicator.  I like to think of it as a gentle breeze in the air while riding a bike.  It won't necessarily determine the direction.  It is either at your back helping you along slightly, or in your face giving you a little resistance.  

Obviously the market can't continue up everyday.  It needs to breathe a little.  Inhale.  Exhale.  The Nasdaq 100 has now posted 7 straight days with higher highs, lows and closes, something that hasn't happened in nearly a decade.  I still think the market can continue to climb that wall of worry but expect a little digestion of the recent gains here and there. 

The I fund did its typical mocking of me by posting a strong day on the first day I am completely out.  This is becoming common for me.  I can't seem to time that one right.

That's all for today.  Currently 65% C, 35% S fund.  Until next time...