All Signs Pointing Up- Is this a Real Bull Charge?

Is the crisis really averted since we are seeing emerging up-trends on all the global indexes? The temptation is to follow the bull’s tail and smell and charge ahead but that is dangerous. Personally, I suspect that this rebound is a bear-market capitulation or “selling the bottom”. With the STI rebounding more than 50% since early March is enough to bring cheers to stock chasers.

Those of us who are deep in the water will hope that confidence is finally restored and that any market gains will be more enduring instead of those gyrations we see with each economic data releases like plunging export sales or growing retrenchment numbers. All eyes shall be on the earnings and guidance announcements and macroeconomic indicators in the first half of 2009. With that, we should have better visibility on whether the prescriptions of fiscal and monetary dosages and injections by the Fed is working up the confidence level to eventually see the thawing of the credit markets and consumers’ confidence in US. Any positive upturn there will have ramifications for an ultra-sensitive Singapore since we are so globally plugged.

I see a range-bound market with more upside than downside down the road and it is walking the fine balance of participating in this rally while watching for any pull-back and if the market does show some signs of flagging, my gut feel is that it will not fall through to the March’s trough.

No need for crystal ball gazing or some tea leave reading, I am just betting my guts that we are about to have some fresh air and I am not holding my breath anymore.