The markets that are looking toppy are in the US. Dow posted it's first quarterly loss after 8 quarterly gains and
SP500 and Nasdaq posted modest gains whilst the rest of the world went gangbusters. Of course a lot of this has to do with the strong dollar but how would our market and other global markets react if the US markets were to drop by 10 to 15%. I don't think they'd go up even if the RBA dropped rates by half a percent. It is expected S & P 500 company earnings growth will be around 2% . This is considerably lower than previous years and I doubt will even see this level of growth. The strong USD is impacting on earnings right now and without any firm direction from the Fed I think this could get out of hand quickly.
On top of this if the USD does get any stronger it will expose the issues within emerging market economies who have very high US denominated debt . This is a crisis in waiting and is probably the next greek like situation the market will turn it's attention to.
IMO markets are shortable , especially if you pick the weaker markets and get the timing right. Or if you use the currency wars to your favour and pick of the indices when their currency appreciates. Again IMO this coming US reporting season and the Fed meeting in May will set the whole tone for the markets for the rest of the year.
