Bear Stearns recent market sell-off may have inspired contrarians to see a buying opportunity in the near future while others embrace themselves and wait.

¨Common threads of the logic go as follows: we had our moment of catharsis with the fire-sale of Bear Stearns; the authorities are coming to the rescue; the dreadful economic data from the US are contrarian indicators of a rally; and the charts suggest we have hit bottom. So despite all the fear, now is a buying opportunity. This is seductive, both because it suggests we can make some nice easy money, and because we all want to be contrarians,¨ according to John Authers of the Financial Times.

So is now the time to use caution and brace ourselves while we sit back and watch the US unbalance regain its footing?

¨The ability to trade as well as invest — to take advantage of all this volatility, rather than simply get knocked around by it — is another potential peace-of-mind source, ¨ says Justice Litle of the Taipan Publishing Group.