NEW YORK ( TheStreet) -- The "sell in May and walk away" scenario remains in play as a June swoon looms. To confirm the May 20/May 22 highs as a major stock market top, the weekly chart profiles for the five major averages must shift to negative technically.Negative weekly closes require that the Dow industrial average, S&P 500, Nasdaq, the Dow transportation average and Russell 2000 must have weekly closes below their five-week modified moving averages with declining momentum. My measure of momentum is a 12x3x3 weekly slow stochastic where readings are on a scale of zero to 100. All major averages have been overbought with readings above 80. In sum, we need weekly closes below the five-week modified moving average with momentum declining below 80. At Thursday's close the momentum readings were 83.73 on Dow industrials, 82.22 on the S&P 500, 85.40 on the Nasdaq, 75.05 on Dow transports, and 81.96 on the Russell 2000. Note that momentum is declining below 80.00 on Dow transports. The five-week MMAs are 14,968 Dow industrials, 1613.8 S&P 500, 3382 Nasdaq, 6276 Dow transports, and 964.83 Russell 2000. Dow transports will have a negative weekly chart today unless a rally causes a close above 6276. It may take another week or two of a June swoon for all five averages to have negative weekly charts, which would confirm the May 20/May 22 highs as cycle highs confirming the strategy to "sell in May and walk away." My semiannual levels remain in the mix, but they become less relevant going into the end of June, because new semiannual levels for the second half of 2013 will be in play beginning in July. A reason for Thursday's rebound was that the Russell 2000 held its semiannual pivot at 965.51.
An important risk is the reversion to the mean which are the 200-day simple moving averages at 13,855 Dow Industrials, 1494.2 S&P 500, 3155 Nasdaq, 5608 Dow transports and 883.10 Russell 2000. Beware that all five major averages have crossed their 200-day SMA in every year of the new millennium except 2013 so far.