The charts don't say so at the present. At this point in time they are stretched but not down. Warren Buffett said once "When the world is fearful I am greedy; when the world is greedy I am fearful!" Right now you can take two viewpoints on the world economy.
#1 The worst is over and we are on the way to recovery.
#2 The worst is yet to come!
Until proven wrong I am in camp #1. This would argue buying your favorite jackpot stock or bringing out any cash that you have to buy the market that could pay off big if #1 is true. I am a buyer of BRCD (Brocade Communications) at this point in time and NG (Novagold Resources). Both are low priced equities with high potential. In BRCD's case they are the ones that are being used as a puppett by both IBM and HP to position themselves against Cisco which in increasingly encroaching their turf. BRCD was doing fine on their own and now they have two giants helping them! BRCD also sruck a unique OEM deal with IBM wherein IBM "private labels" BRCD's stuff and resells it under IBM name. For the world of me I can't believe that IBM just did not bite the bullett and acquire BRCD. Maybe BRCD's asking price is too high? If that is so is this because they have a great quarter to report and future quarters will only be better? BRCD's current quarter announcement is on May 21, 2009 which is next Thursday AM. In the case of NG it is one equity that I see on Motley Fool CAPS (Fool.com) as getting rave reviews by a tough investor base. Additionally, Gold is on the rise! If recovery happens inflation is here!
Two bets to make in this market which does not cost a whole lot. Let us see what happens.