Friday, April 4, 2014

Stock market - 4 April & forward

How far will the stock market rise?

Stic     3220
Klci.   1855
Hsi.     22565
N225  15071
S&P    1886
DJIA.   16552

Dow Jones & S&P 500 have gallop ahead despite pundits betting against them. There are two broad markets : the developed market & the emerging market within which you find blue chips & 2nd/3rd liners.

Looking at the crystal ball now, it seems that correction is imminent. The recent run-up, an overbought position, lack of new impetus coupled with April/quarterly low ring alarm of an impending correction albeit major.

What's holding up the market is a courageous contrarian plot; where everyone is expecting a drop, it is seldom delivered.

Drop, it will. The next two weeks can be telling!

Will the bear swing send the bull to the abattoir ? No.

Market psychology has swing from momentum trading (hot money) to contrarian trading (follow the money). The range & depth will be wider & deeper & the swings more volatile.

For the moment, catch (buy) the drop & sell in May & go away.

October will always be the most rewarding month. For those caught on the opposite fence, it's also most damaging.

This year rewards will go to contrarian players. Watch M&A.

Happy trading & trade with extreme care.

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