David Fuller's view Price charts provide a reality check, in terms of supply and demand, in markets where theories and biases abound.

Merrill Lynch 10yr US T-Bond Total Return (monthly & weekly) - This is easing within a narrow range since early June 2012 and there has been a failed break above 2000, despite QE. This has happened before and the reaction lows are still rising but a new high is required to reaffirm an overall upward trend which clearly has bubble characteristics.

The USA's S&P 500 Index (weekly 10-yr, weekly 5-yr & daily) was less volatile in 2012 than during the two previous years, interestingly. Is this due to more investors returning and increased QE? Whatever, the progression of higher highs and higher reaction lows remains consistent within an ongoing cyclical bull trend. Political concerns remain but the USA's advantage of cheaper oil and gas is likely to be more enduring. A close under 1400 would be a warning and a break beneath 1340 would end the consistency of higher reaction lows and confirm that resistance had been encountered from the 2007 highs.

China's Shanghai A-Shares Index (weekly & daily) has moved through initial resistance with ease, including the first break in the sequence of lower rally highs three week's ago. For those of you who have attended The Chart Seminar, this is a V-bottom formation which will eventually spill over into the right-hand extension and consolidation phase. First, we may see the current rally slow into a somewhat more rangy phase, which eventually loses upside momentum. Thereafter, if the right-hand extension pause retains most of the gains since the early-December low, as I suspect, SHASHR should remain a relative strength leader over the medium-term as well.

This performance by SHASHR has turned the mainland China influence from a regional headwind into a tailwind.

Hong Kong's HSI is more relevant for most non mainland Chinese investors. It is beginning to look a little overextended in the short term but underlying support established since October 2011 can easily sustain a test of the 2010 psychological high near 25,000 within the next few months.

Taiwan and South Korea show base formations which began to form around October 2011 and are now in the latter stages of development. KOSPI is slightly in the lead and provided the reaction lows continue to rise, as I suspect, these formations will support challenges and clearances of the previous highs shown over the medium term.

Singapore has already completed its base of an approximately similar size and duration, and the 2010-2011 high is currently under challenge. A break in the progression of higher reaction lows would be required to question scope for clearance of this high, followed by a test of the 2007 peak.

The Philippines, Thailand, Indonesia and Malaysia have been relative strength leaders for most of the last four years and remain in form. However, the first two are somewhat overextended relative to their 200-day MAs, and therefore susceptible to temporary reactions and consolidations. Nevertheless, there is still no evidence that either top formations or climactic accelerations are occurring.

Australia's S&P ASX200 Index has been reinvigorated by China's market recovery and may continue to take its queue from its biggest customer. Meanwhile, the base has been completed and has more than enough underlying trading to support a successful test of previous highs since 2009 near the psychological 5,000 level. Australian yields remain generous.

In conclusion - Provided China continues to perform as expected, Asia should remain an attractive place to invest in 2013.

Here are the historic earnings and yields for the indices above:

S&P - - - - - 14.83 & 2.18%
SHASHR - 12.59 & 2.50%
HIS - - - - - 11.98 & 3.03%
TWSE - - - 25.32 & 3.44%
KOSPI - - - 19.60 & 1.22%
PCOMP - - 19.34 & 2.21%
SET - - - - - 17.67 & 2.28%
JCI - - - - - - 17.47 & 2.02%
KLCI - - - - - 15.51 & 3.51%
AS51 - - - - - 18.19 & 4.46%

The valuations which so many strategists were fearful to recommend in 2009 are no longer cheap as the cyclical bull trend commences its 5th consecutive year. However, they are not exorbitant against the background of a strong monetary tailwind. The time to worry will be when global GDP is stronger and the monetary stimulus is being curtailed.