Investors need to know that the current market moves are not based on fundamentals, Kirby Daley, senior strategist at Newedge Group, told CNBC Thursday.
"Be very careful when you are playing these markets that aren't based on fundamentals, because when it starts to come back, you have no idea when to get out, " Daley said on "Squawk Box Asia."
Investors are not being realistic about the recovery scenarios in Asia and the U.S., ignoring the fact that the U.S. consumer is the main driver of global growth and faces big headwinds, he said.
"All of these recovery scenarios are based on this belief that the U.S. consumer, magically somehow, will be back in the face of higher unemployment, credit that is tightening, the dissemination of wealth and lower incomes," Daley said.
Investors are only enjoying a "medicated high" at the moment and that the worst advice possible would be to buy on dips, he added.
"The problem is you don't want to take a loss and before you know it, you realize this was a bear market rally and you are down 30-40 percent," he said. "What do you do then?"