5/22/2014 5:56:15 AM

Good morning traders,

As the QQQs reach the top of the left shoulder, you can see the rule of alternation in action as you have a simple left shoulder, and a complex right shoulder.

That being said, even with this right shoulder coming on very light volume (we're seeing the lightest trading volume of the year on the markets) there's nothing that says the market can't continue higher here and if it breaks the previous highs, we'd simply look at the pattern as a broadening top pattern.

Also note the level of selling that came in on the down days during the last decline. If we don't see that action develop today or tomorrow, then you would have to believe we'll head higher into July.

On the bullish front:

Now this data series is also unique as the level of those neutral on the markets remains at an all time high. I expect these readings to moderate.

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Regards,

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