- Technical Market Commentary -

(Go to http://www.financialwire.net/?s=kllrfby+cmmtry for more of Kollar’s commentaries.)

May 6, 2010 (FinancialWire) (By Frank Kollar) — Shares of the ETF Biotech HOLDRS (AMEX: BBH) have declined dramatically over the past two months. Is a tradable bottom near?

Biotech HOLDRS reached a closing high of $106.99 on March 22, 2010. Since then, shares have declined 11% but have reached strong support levels.

In the big global selloff on Tuesday, May 4, Biotech HOLDRS declined to $95.00 a share which is about 1% below very strong support at $96.00 a share, the 61.8% retracement of the entire March-April decline.

On Wednesday, May 5, Biotech HOLDRS reversed from the $95.00 level and closed with a 1% gain at $96.37, on a day when most markets were lower.

This could be a bottom. A bullish trade with a sell stop at about $93.50 a share would have little risk and a decent chance for upside gains to at least the $101-102 level if not higher.

Disclosure: Kollar’s Fibtimer.com Stock Timing Strategy holds a position in Biotech HOLDRS.

(Go to http://www.financialwire.net/2010/04/22/about-kollar/ for more about Mr. Kollar, and go to http://www.financialwire.net/?s=kllrfby+cmmtry for more of Kollar’s commentaries.)

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