ETF Biotech HOLDRS (AMEX: BBH) To Test Lows Says Market Timer Frank Kollar

June 8, 2006 (FinancialWire) (By Frank Kollar)

Until just a few days ago, the exchange-traded fund Biotech HOLDRS (AMEX: BBH) looked like it had turned a corner. With core positions in Genentech (NYSE: DNA), Amgen (NASDAQ: AMGN) and Biogen (NASDAQ: BIIB), Biotech HOLDRS’ reversal from support was followed by a 10-point rally. But Biotech HOLDRS is again headed lower.

Support remains at $172.00, which is the 50% retracement of the entire 2005 biotech rally. This level was successfully tested several times in May. Support levels that result in a reversal are powerful indicators. But they can only be tested so many times before they break. If Biotech HOLDRS makes a decisive close below this level, it could lead to a fast run to $162.50, which is the Fib. 61.8% retracement level and critical support for Biotech HOLDRS.

Frank Kollar has been timing the financial markets since 1982, with online service since 1996. He is a dedicated trend timer and his strategies exited the markets before the crash in 1987 as well as the bear market in 2000 through 2002. During the 2000-2002 bear market, his bearish positions resulted in gains exceeding 100 percent, all achieved by trading trends.

Kollar’s research has shown that the financial markets are in tradable trends approximately 80 percent of the time. FibTimer strategies define trends and trade them in both advancing and declining markets. Caring nothing about what newscasters say or what the latest economic indicator predicts, trends are where the profits are, and that is where FibTimer is.

Kollar is editor and chief analyst at FibTimer.com (http://www.fibtimer.com) which offers market timing strategies for S&P and Nasdaq index fund traders, as well as bond, gold, small cap, sector, ETF and stock trading strategies.

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