Stock ETFs Hold the Line Despite Bearish Headwinds | ETF Trends

The S&P 500 has survived three tests recently of its 200-day moving average, and bulls were celebrating Tuesday with a rally that pushed the index higher by over 1%.

Stock exchange traded funds have passed this technical test so far, but there many bearish headwinds in the market, including questions over Greece and Europe’s debt crisis, the U.S. debt ceiling, state budgets and the end of the Fed’s bond-buying program.

Dennis Slothower, a prominent technical analyst, says short term market leadership may be returning to the bulls for now, Mark Hulbert reports at They “could quite easily push during this end of June/early July window dressing period to fake out traders and get them to jump on the train that would clearly look like it is leaving the station.” [S&P 500 ETFs Survive Tests of 200 Day Average.]

He reminds stock market bears the 200-day moving average “has to be breached if the bears are going to take control. Since that hasn’t happened yet, it suggests the fear level is being contained.” [S&P 500 ETFs Back for Test of 200 Day Moving Average.]

The European debt crisis is weighing heavily upon the markets, which is a point for the bear camp. In the U.S., state budgets are stretched, inflation concerns are rising and QE2 (quantitative easing) expires at the end of June.