Adding value to your analysis.

Watch the Hang Seng: Big Picture suggests tracking the Hang Seng Index which it says represents the risk appetite of investors. The full article and chart can be found here. This is an interesting thought. Can the Hang Seng be a leading index?

Fear is the key. Excellent insight for investors comes from A Dash of Insight. You can read it here. Jeff Miller says “To emphasize, if the market was always right, you could never gain an advantage. Making strong returns involves stepping up when the market is wrong. The greater the irrational fear, the more difficult it is.” 
There is more.  “Here is the challenge for investors: If you are going to buy when others are fearful and sell when they are greedy, how do you know when to act?” The answer is to use data –  “to focus on the numbers — earnings, the current GDP growth rate, the huge risk premium indicating that stocks are cheap by historical measures.”
Finally, “Investors need not and should not go “all in” but neither should they go “all out.”

Shape of Trading. The author of a new book “A History of Greed” discusses his book in the blog naked capitalism. He says “We should be asking whether Wall Street – that is, the financial community – is justified at all in its present size”  …   “Speculation has to be seriously limited to small institutions through the use of higher capital requirements.  ” ….  ”

My Notes: The purpose of finance is to lubricate the wheels of the economy. In the Market Economy, finance has becomes the reason for existence. This is likely to change in the next few years, as finance will again take a back seat, with the truly productive sectors of the economy coming on the forefront. This is good news for traders, since manipulation / chaos will reduce in the markets.