The More You Know, The Less You Know

I will officially tone down my bearish view on the market unless there are more negative news to justify the view.

Everyday, it seems the more I learn, the less I know about the market. It is pointed out to me that the US yield curve is normal or positive. From this knowledge, it is better to hold a less bearish view.

If there is change in the yield curve from normal to flat, that might raise a few flags.

The market reacted negatively to today's CPI numbers would likely mean that the Fed would reconsider its aggressive rate cut position and take a more hawkish inflationary watch MODE.

AIG's CDS

CDS iceberg is tipping out of the water, weather it hits like sub-prime, it will unreveal soon.

Today it is just AIG unable to value its CDS, AIG's stock dropped 10%. Will we see more? I think so.

As of this post, Dow is trading at 12132 (-50 pts), off it low.

STI Monthly

The STI is up 200% since the start of 2003. Today, we are correcting and it is down 73% from its recent highs. Most ppl think this is a correction but technically speaking, when an index is down 20% from its highs, it is the beginning of a bear market. I thing 73% speaks volume.

Seldom are we able to pick the bottom or sell the top, I hope we can see a bottom soon. For the moment i see the bottom around 2200 to 2600 for the STI.

STI Charts

Cannot pass the dotted downtrend line. I think STI may close at 2888 today. Looks like the rut on Wall Street is not over yet.

Bulls and Bears

I think people expect the market to drop like a hot brick and hit the bottom. If the charts are telling a story, it looks like a painful and slow death.

Unless STI break the 3150 to 3200 range, i dun think there is any story. There are firm bulls and bears in the market, so at least this market is sane.

I think the maximum activity will be down not up.

SG Market

If we are going to reverse, we need to break 3200 with volume and gusto. STI is relentless pushing up hard and fast, mimicking our good brother Hang Seng.

I believe there are some can of worms that have yet to be open in this credit crisis. Perhaps, a 75 basis point cut will let the market breathe abit but i dun think the worse if over.

I dun think 3 months of rut can be resolve with a 2 day 300 pts move. I am a bull and like vibrant market but the odds seems to stack against this tired 10 year bull. Maybe it is time, maybe it is not.

Only time will tell, invest and trade safely.

STI Recovers Late In The Session

End of correction/meltdown? I think it is still too early to be said but that being said, there is money to be made in such fast and furious rebounds.

Those who sold today may wonder why they did it, those who bought are placing bets that Wall Street will not tank too much tonight.

I think we have downside bias for a few more session before a clearer picture can be seen.