Wow! Last night was an exciting night. I couldn’t help looking at the market until 4am (besides watching Golf’s US Open). The 3 US indices staged a sharp rally on mixed volume. The Nasdaq bolted 2.8%, its best day since March 25, 2004. The S&P 500 jumped 2.1%. Smaller stocks outshined as the small-cap S&P 600 and midcap S&P 400 galloped more than 3% each. This marks the SECOND STRAIGHT day of rallying since the S&P 500 hit a low of 1221.

Most market analysts, technical chartist and experts have predicted that the correction will be much more severe for much longer before the market rebounded (I said the same thing 4 days ago). So are we all wrong? Well, if we are then, again it proves that NOBODY can predict the market.

Does 2 straight rallying days signal a confirmation that the correction is over, bottom is hit and the S&P will continue its long long term bull phase? The ANSWER IS TOO EARLY TOO TELL. Usually, the market must rally AT LEAST 4 STRAIGHT DAYS on HIGH VOLUME before we can safely say that the corner has turned and market is back at ‘Confirmed rally’. This is when it is safe to jump back in to momentum stocks (if at buy point) or buying the S&P index.

Nonetheless, I bought a SMALL PROPORTION of S&P Index CFDs last night at an average of 1242.50. At the current price of 1255.40, I made some pocket money of US$645. However, I will re-buy back all my sold lots ONLY WHEN the market follows through on DAY FOUR (next Monday). We shall see….

On the Singapore front, I bought a couple more lots of Osim at $1.40 and HTL at $1.13. I still believe these are strong companies with lots of growth potential and at current prices, are worth it.

Those of you guys into Momentum stocks may want to key a sharp eye out on your watch list IF market follows through and gets back into CONFIRMED RALLY next week. Here are some potential A+ Stocks you can look at (wait till buy point):

1) First Marblehead (FMD)

2) Herbalife (HLF)

3) West Pharmaceutical Services (WST)

Have Fun…Make Money