For Sunday, June 22, 2008                                              Go to Website
	Current Strategy Positions FibTimer currently has 11 successful timing strategies   Aggressive S&P Position -          BEARISH   Aggressive Nasdaq Position -   BULLISH   Aggressive GOLD Position -      BEARISH   Aggress. SMALLCAP Position - BULLISH   U.S. Dollar Timer Position -        BULLISH   Aggressive BOND Position -      BEARISH These positions were started over previous weeks. You need a paid subscription for real time signals. Sector Funds, ETF and Stock positions are not included above.

Last week we wrote:

"...A week of lower prices was turned around late Thursday for the S&P 500 Index - SPX as well as all the major indexes as buyers stepped up to the plate and reversed a down day. Friday was bullish throughout, closing the week on a positive note as well as wiping out all the losses from early in the week."

This week:

If last week was a bullish one, this week was its opposite. They say it is always darkest before the dawn. If this is true, dawn should be around the corner because the S&P 500 Index - SPX chart is about as bearish as can be.

During the week we wrote in a press release that the SPX had held at critical support. That level was the Fib 61.8% retracement at 1341.49 and as of Thursday, it had been twice tested and twice held.

But Friday's decline not only reached critical support but also closed beneath it, a very bearish indicator that forecasts continued declines and a possible test of the March panic lows in coming weeks.

Of course the SPX position in this strategy is already bearish so bearish indicators are not of much concern except as verification of current trend. But the potential of a test of the March lows is something to worry about.

Those panic lows, at (about) SPX 1270 (see below chart) held in both January and March and should be the base for a new bull market. Reaching them is not what any analysis of the charts would have forecasted.

That said, we still feel that a reversal to the upside is likely to be near. We follow the numbers and so remain in a bearish position, but a reversal at current levels would be a bullish event even though the SPX closed just below support. Next week could very well be the most critical one of the current decline.

Last week we wrote: Considering the strength of the preceding rally, coming off panic lows back in January and March, it looks like the stock market is more likely to continue higher from here, though with the same volatility that has marked this advance from the start. This does not mean we have a buy signal yet, only that the odds appear to point to higher highs. More selling next week could be a very bearish event. Should the SPX 1321 support level fail it would likely result in a test of the March lows. Scary indeed.

The SPX remains well below the 50-day moving average as well as the 200-day moving average and both averages are pointing lower.

The CBOE Volatility Index - VIX is bullish based on its daily chart. That is a positive for the markets.

The price of oil remains a concern. Though many predict higher prices still ahead, a negative for stocks, the oil markets have all the appearance of being in a much extended bubble. Oil costs only $2 to get from the ground to the barrel. The high prices are far, far ahead of themselves. Should the bubble break and we see prices drop to $110 or lower, the stock market may very well rally to new highs. Of course, oil prices need to decline first.

The SPX position remains in a cash position for both aggressive and active traders. Before we enter bear funds for aggressive traders we need to see potential for a new down trend, not just a correction. Shorter term corrections just result in losses for bear fund traders. They are over too fast.

Note: For subscribers, who overly worry about short term swings in the financial markets, remember that you do not have to be an aggressive timer to be a profitable timer. Money is made in both aggressive and conservative style trading. Our Conservative S&P Timer strategy trades only the long term trends but that means it profits without the numerous buy and sell signals that active and aggressive traders take.

The SPX portion of this strategy is in a BEARISH position. Subscribers following this strategy should be in a CASH (money market funds) position in both the Bull Only and Bull & Bear strategies

S&P 500 Index (SPX) Daily Chart

Nasdaq 100 Index (NDX) Chart Analysis

Last week we wrote:

"...Selling in the previous week carried into this week as the Nasdaq 100 Index - NDX reversed from rally highs, to correction mode along with the rest of the stock market. The NDX has been the shining star in the rally from the March lows. That continues to be the case as the correction in the NDX has been very subdued in comparison the big cap indexes."

This week:

Subscribers should take a moment and compare the below chart of the Nasdaq 100 Index - NDX to the chart of the S&P 500 Index above.

They are quite different. The SPX is in full retreat, closing below critical support this week. Meanwhile the NDX is in only a mild correction, not having reached even the first support level at NDX 1853.92.

Why the difference? Usually such a divergence is a bearish event, and we cannot deny that this time it may also be bearish. But we just cannot help but see the strength in the Nasdaq as bullish.

Strength in the NDX is typical of bull rallies. Could this be a sign that the next big move is to the upside?

That said we must say that the NDX is now extremely close to a sell signal. We could see it on Monday if the market again moves lower.

The NDX again closed below its 50-day moving average. Not a good sign though both averages, are within a day's trading of being crossed to the upside should we start the week in bullish mode (next week).

The NDX is not anywhere near its support levels all the way down at NDX 1853 and 1810. Again, strength continues in this tech heavy index even while the stock market appears to be in an all out bearish retreat.

Bottoms are made when least expected and when traders have given up. The SPX chart may have reached that point. the NDX chart has not. This could be a ray of light leading to a rally, or it could be that the NDX is the next shoe to drop. Monday may be the deciding day.

The NDX portion of this strategy is in a BULLISH position. We are now in the Rydex Nasdaq 100 Fund - RYOCX (or other bullish Nasdaq 100 index fund) for both active & aggressive traders.

Nasdaq 100 Index (NDX) Daily Chart