- Technical Market Commentary -

June 25, 2010 (FinancialWire) (By Frank Kollar) (Go to http://www.financialwire.net/?s=cmmtry for all recent commentaries.) — Both the S&P 500 Index (SPX) and its tracking ETF, the S&P Deposit Receipts (NYSE: SPY), are at do-or-die support levels. There have been more than a few bullish indicators flashing buy signals over the past several weeks, yet this week the stock market has done nothing but decline.

Those declines have taken SPX directly to critical support, at 1074, which is the 61.8% retracement of the entire June rally (and needs to hold). If broken in coming days, look for another test of SPX’s prior lows, at 1050.

Recent declines have also taken the corresponding S&P ETF (SPY) to critical support, at 107. That is also the 61.8% retracement of the entire June rally (and needs to hold, as well). If broken in coming days, look for another test of SPY’s prior lows, at 107.

In addition, both SPX and SPY are now below their 200-day moving averages, which presents an additional negative hurdle for the stock market to overcome.

In order for the market to get back on track, generally speaking, we need a rally. Specifically, we need to see closes above 1117 (for SPX) and above 112 (for SPY).

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

The FirstAlert(tm) Money Index is an indicator of the depth of market direction or indirection. While not always including the same stocks, the NYSE/NASDAQ/AMEX 25 most actives and NYSE/NASDAQ/AMEX greatest percentage losers and percentage winners (weighted against pure monetary loss/gain) indicate the direction in which the mass of money is flowing, as well as the general focus of the market. Last session’s most actives showed 3 advancers versus 22 decliners. Volume leaders were led by Citigroup, Inc. (NYSE: C) (streaming research for Citigroup available at http://investrend.stocksmart.com/ri/toc?tid=7921), the SPDRS S&P 500 Trust ETF (AMEX: SPY) (streaming research for SPY available at http://investrend.stocksmart.com/ri/toc?tid=34430) and the PowerShares QQQ Trust ETF (NASDAQ: QQQQ) (streaming research for QQQQ available at http://investrend.stocksmart.com/ri/toc?tid=1044870), Bank of America Corp. (NYSE: BAC) (streaming research for BAC available at http://investrend.stocksmart.com/ri/toc?tid=8456), the Financial Select Secor SPDRS ETF (AMEX: XLF) (streaming research for XLF available at http://investrend.stocksmart.com/ri/toc?tid=1026233) and Microsoft Corp. (NASDAQ: MSFT) (streaming research for MSFT available at http://investrend.stocksmart.com/ri/toc?tid=4652).

The FirstAlert(tm) Economics Calendar lists Gross Domestic Product for Q1 (8:30 am ET); Corporate Profits for Q1 (8:30 am ET); University of Michigan Consumer Sentiment Index for June (9:55 am ET).

The FirstAlert(tm) Events Calendar showcases UMH, BIOC, DARA and MDXG at the Sidoti MicroCap Conference.

FirstAlert(tm) Website of the Day:  http://www.networldmap.com/

Quote of the Day: "There's no such thing as a small part. There are just small actors." –Sidney Lumet (b. 06/25/1924), US director.

Word of the Day: kowtow \KOU-TOU\, verb: 1. To act in a subservient manner. 2. To kneel and touch the forehead to the ground in expression of deep respect, worship, or submission, as formerly done in China. noun: 1. An act of servile deference.

In context (as verb): “The administration would kowtow to student activists by agreeing to meet with them and behave as if their demands merited serious consideration.” –Debra J. Saunders, “Starving for attention at UC Berkeley", SFGate, May 2010.

(Kowtow is from the Mandarin k'o-t'ou, the custom of touching the ground with the forehead to show respect or submission, literally "knock the head.")

Today is: Take Your Dog To Work Day (http://www.takeyourdog.com/)

Happy Birthday: 1925 – June Lockhart, American actress; 1952 – Alan Green, Northern Irish BBC sports broadcaster/commentator; 1964 – Greg Raymer, professional poker player; 1970 – Erki Nool, Estonian decathlete; 1978 – Layla El, 2006 WWE Diva Search winner.

Today in History: 1876 – Battle of the Little Bighorn and the death of Lieutenant Colonel George Armstrong Custer; 1947 – The Diary of Anne Frank is published; 1981 – Microsoft is restructured to become an incorporated business in its home state of Washington; 1997 – An unmanned Progress spacecraft collides with the Russian space station, Mir.

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Disclosure: Frank Kollar’s Fibtimer.com ETF Timing Strategy has a position in the S&P 500 SPDRS.

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