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Bank of America’s April global fund manager survey shows extreme pessimism in the market with investor cash balances rising to 5.9% in April, the highest since the 9/11 terrorist attack. 

A contrarian “buy” signal is generated for stocks when the average cash balance rises above 4.5%, and a contrarian “sell” signal is generated when it falls below 3.5%, according to Bank of America. 

The US stocks have witnessed a solid recovery rally over the last three weeks, largely due to Federal Reserve’s multiple liquidity injections. As of Wednesday, the S&P 500 index was up more than 25 percent from the multi-year lows observed on March 24. 

With the fund manager survey indicating extreme pessimism, the recovery rally in stocks looks set to continue. That will likely strengthen the offered tone around the traditional safe haven assets like yen, gold and treasuries.