I have to apologize for an error in my analysis of crude oil in yesterday's blog. I try to use the most recent contract chart for my analysis of crude, and I had been using the June contract chart. That chart had not been updated yesterday so I was doing my analysis unaware of Wednesday's down day. This wouldn't have made much difference anyway because crude decided to peak one day before entering our reversal zone (May 23 - June 1). These reversal zone boundary dates are not set in stone, and there is a certain margin of error on both sides of the reversal's center point. The center point has the highest probability of reversal, and the probability decreases before and after that point. We usually allow three days on each side of the center point, but this does not mean it is impossible to have a reversal at four (or even more) days from the center; it is just less likely.
The bottom line here is that it looks like the peak of the current medium-term cycle in crude happened on Tuesday, and prices are now falling to the final cycle bottom. It is too late to sell short so we will now wait for the bottom of the cycle and an opportunity to buy. I will update this analysis over the week-end with a likely target area and timing for the bottom.