Bearish Indicators Abound Says Market Timer Frank Kollar

February 20, 2009 (FinancialWire) (By Frank Kollar)

The S&P 500 Index (SPX) has broken below its January lows this week and did so with a huge gap down day on Tuesday, February 17. Thursday was a bearish outside continuation day typically followed by lower lows.

Where will those lower lows be?

The bear market closing lows for the SPX, reached on November 20, were at 752.44. This is only 3.5% below Thursday’s close. In this volatile climate, only a single bad day’s trading.

This is the test of the bear market lows predicted by several market technicians including us. If 752.44 holds we could see a huge rally from near current levels. If 752.44 is surpassed to the downside with a decisive close below, the next support level is all the way down at SPX 697.00 a share.

This would also mark a technically bearish break of major support that would forecast considerably lower lows, in several waves down.

The Nasdaq 100 Index (NDX) remains above its January lows, so this is one ray of sunshine in an otherwise bearish scenario.

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.

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.

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