We celebrate Chinese New Year this month. The coming year is Tiger year. Tiger represents bravery and aggressiveness. The outgoing year is Ox year. Ox is supposed to be hard working. Ox year bore witness to a bull’s market indeed in the terminology of stock trading. The indices of all four Chinese stock markets had increased significantly in the past year after the economic down turn in 2008. Will this year be another bull’s year? The Chinese zodiac has clearly indicated otherwise.
The investors who will win out in this year need to be both brave and aggressive. There are signs of caution looming all around. The skyrocketing real estate market had alerted the Chinese government as evidenced by the 11 points issued by the State Council. The performance of stock market in 2010 hinges on two major factors. First of all, whether the housing market can still play the role of locomotive and secondly how high the lending interest rate will hike in the financial market.
It appears that the Chinese government is ready to regulate the real estate market and the lending interest rates will go up to a certain degree. Therefore, we will definitely not see a bull’s market in this year. It takes courage and aggressiveness to realize profit in this tiger market. We predict short term tactics and maneuvers will be the main stream of this year and the precarious stock market is definitely not for the timid in the tiger year.