After the Dragon Boat Festival holiday, the Taiwan stock market opened with significant declines, falling over 400 points at one point and hitting a low of 20,940, sliding below the 21,000 mark. In response, finance expert Ruan Mu-Hua mentioned in the online program 'Stock Selection Chat Room' that whether it's Taiwan or US stocks, the only condition for a bear market to turn into a bull market is a V-shaped reversal, which is the case for both markets now.

Ruan noted that the S&P 500 index has rebounded from 4,810 points up to nearly 6,000 points, coming close to its historical high of 6,130 points, and it only takes a few percentage points to break that record with just a couple of upward bars. This recovery has also allowed it to regain the 100-day and 200-day moving averages, indicating strong market momentum, despite a pullback that left it far from its recent lows.

He further explained that while one may not see the 'offshore flow' in the stock market, subtle signs suggest that adjustments could be coming. For instance, from May 20 to May 30, the S&P 500 index witnessed four consecutive days of decline, followed by another four days of mixed trading. For the month of May, the S&P 500 index rose by 6.3%, primarily driven by the strong performance from May 1 to 19, where it only declined on three days and experienced one day of a 3% gain.

Ruan pointed out that the real concerns for US stocks stem from the recent eight trading days, which may not be immediately apparent through K-line analysis. A closer inspection shows that the same pattern that preceded the significant rises in March and April was already evident in February. He also urged investors to pay attention to the VIX index for US stocks, as it surged during the significant declines in March and April, demonstrating volatility that could have been detected as early as March when it began to rise slowly from below 20 points. Currently, it sits at 18.57 points, which is near its low for the year and suggests potential increases ahead.