Rally Still Intact Says Market Timer Frank Kollar

May 9, 2008 (FinancialWire) (By Frank Kollar)

The S&P 500 Index – SPX dropped on Wednesday, May 7, as oil prices reached new highs, a daily event of late. The Dow Jones Industrials - DJIA lost over 200 points while the SPX shed 25.69 points.

Is this the start of the great unraveling? Has the rally hit its last new high?

Last week we wrote that the first resistance level, marking the 50% retracement of the entire six month decline, was at SPX 1416. A close above this level would be bullish and forecast a run to at least SPX 1454.

Tuesday’s close was only a fraction above SPX 1416 and the next day the market sold off. When profit-taking occurs right at projected resistance levels, it is actually bullish. Look for higher highs over coming weeks, and maybe a bit more selling along the way to SPX 1454.

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.