Many market-watchers say the down-leg is not yet played out

On Wall Street, where perception can be as important as reality, the opinion that there are economic problems ahead - a view not quite borne out by current economic data - may keep the market weak despite a recent rally.

An investor must look ahead to how his investments will be faring six months or more down the road. That makes him susceptible to prediction and speculation.

Henry Kaufman, the Salomon Brothers economist, had a significant negative impact on the market last Thursday when he forecast a rise in interest rates.

But after watching six weeks of declines, many investors apparently decided that this clearly caused afear-induced, and in the final hour of trading Thursday the market reversed itself. The rally continued into Friday, when it jumped 30.47 points, despite a report of a 0.6 percent rise in the consumer price index. The rally heartened many who had felt the market was nearing its current low point. The Dow closed the week at 1,165.10, up 16.23 points since Feb. 17.

Still, worry predominates. Only the bolder analysts believe stocks have bottomed. Most, like Suresh Bhirud, portfolio strategist with First Boston, continue to detect pressure to sell. First Boston has been counseling its clients to increase their holdings of cash or cash equivalents. Similarly, Joe Bartell, portfolio strategist with Butcher & Singer, has been advising higher cash positions or even ''shorting the market'' (an aggressive technique in which one borrows stocks to sell in the hopes of replacing them with cheaper securities as the market falls). The upturn late last week was only a ''temporary respite,'' he says.

Mr. Bartell indicated the market is still far from the lowest it will actually go in this decline. He sees the Dow dropping further, picking up some ''psychological support'' at the 1,050 level but continuing to fall until it reaches the 900-to-950 level, then turning around.

''Sentiment has dramatically changed'' since the first week of the year, says Mr. Bhirud of First Boston. Only a decline in interest rates - an unlikely prospect - can cause stocks to rally significantly, he believes.

Robert J. Simpkins, managing director of Delafield, Harvey & Tabell of Princeton, N.J., is not so pessimistic. He believes the market is currently oversold. Noting that the market rose 68 percent from Aug. 12, 1982, until last October and that the current ''correction'' has caused a 12 percent decline from that high, Mr. Simpkins ventures: ''Within a week or two we will get a rally. Right now we are at or near the effective low.'' With such a range of views, the question for most investors is: Should one stay in stocks, use this opportunity to buy, or get out of the market altogether?

James Balog, senior executive vice-president of Drexel Burnham Lambert, advises continuing to hold cash or cash equivalents for the time being if an investor had converted holdings before the Dow dropped to its current level. He and Mr. Simpkins see the six-week decline in the Dow as an aberration in a historical bull market. Mr. Balog is still bullish on stock and recommends holding onto blue chips.

More-bearish analysts suggest continuing to sell or, if desiring equities, holding more ''defensive'' stocks. Mr. Bhirud cautions that even ''defensive stocks don't help if the market goes through another 10-20 percent decline.''