Has Calm Been Finally Restored?

Stocks rallied worldwide this week after China cut borrowing costs by the most in 11 years and the Federal Reserve’s pledge to buy $600 billion of debt sent mortgage rates down by the most in at least seven years.

On the other hand, Citigroup has jumped 87% since the U.S. government injected $20 billion of capital into the bank at the start of the week and guaranteed $306 billion of its mortgages and other troubled loans.

More than $30 trillion has been wiped off the value of global equities this year as credit losses and writedowns approached $1 trillion in the worst financial crisis since the Great Depression.

The question remains, have we reached the bottom?

Past year's trend tells us that we should not get overly optimistic yet, as any signs of recovery could well be merely a bear trap!

Here is one of the key observation I made, that is, Down Jones Industrial Index is still trading within a bearish descending triangle. It is now at a critical cross road, that is, the next few days or weeks could potentially derail again all the positive development that has been established over the last one week! Technically speaking, the signs are pointing to a likely major bottom again!

I am holding on the same view until it proves me otherwise...