- Technical Commentary -

September 4, 2009 (FinancialWire) (By Frank Kollar) — After several days of selling, the S&P 500 Index (SPX) as well as its tracking ETF the S&P Deposit Receipts (NYSE: SPY), reached initial support levels on Wednesday, September 2.

That support is the 50% retracement of the August 2008 through November 2008 bear market declines. It is a level that was surpassed over the past month, but which now should be expected to act as support.

That is what happened on Thursday as all the major indexes reversed and moved higher, especially in the final hour of trading when a substantial rally occurred.

The end day rally bodes well for Friday AM but the critical level is 987.47 for the SPX and $98.80 for the SPY. These levels need to hold or the market will see lower lows in coming weeks.

(The http://www.fibtimer.com ETF Strategy has a position in the S&P 500 SPYDRS.)

[Go to http://www.financialwire.net/?s=frank+kollar to see more commentaries by Frank Kollar.]

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