The sharp correction in stocks is signaling that equity traders think a double-dip recession is imminent.
Shares are off by 12% this week, a sharp correction after a buoyant January.
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The sharp correction in May and early June was once again fueled by Euro debt concerns and weakening economic data.
When a fifth wave is extended, we should be on the alert for a sharp correction once that wave completes its run.
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"There could be a sharp correction at some point, but no one has any idea about the extent or magnitude, " he said.
"However, with markets looking overbought, we may be due a sharp correction and investors should certainly be trading with caution, " he added.
This time next year, we could well be seeing another sharp correction.
"It could really blow up" if there is another crash or sharp correction, says George Middleton, an independent financial adviser in Vancouver, Wash.
This sharp correction was outside the experience of most City professionals.
Another interesting investment was property, which in general provided investors with highly attractive returns over the past decade, even after the sharp correction during the recent recession.
As you can see from the chart, the rather sharp correction from the September peak occurred during a seasonally strong period, but since the initial plunge, gold prices have again begun to edge higher.
Our next step will be to figure out these minor waves, and once we are comfortable that the fifth minor wave is underway, we should exit most long positions and prepare for the inevitable sharp correction.
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Smith said any further problems in the eurozone could mean a sharp downward correction in the euro that weighs on commodities.
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Elliott Wave analysis suggests that not only will the correction be sharp, but it will go deep and can potentially reach the minor wave ii within the fifth wave.
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Maybe they will all be right this time, but often the correction is so sharp that they no longer want to buy.
The seasonal low was right on target, as crude oil prices did rally into July 2009 (point 6), but after a sharp, four-week correction, it again accelerated to the upside.
But one rash act or poorly informed decision can lead to sharp losses before you can say market correction.
Though the correction from the 2008 highs was quite sharp, it held above the lows from 2007, keeping the uptrend intact.
That would bring about deep cuts in expenditure and sharp tax rises to slash the budget deficit, a correction that analysts say could cause a new recession.
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As I noted in my recent trading lesson, the Spyder Trust ( SPY) had two sharp double-digit rallies in 2012, but each was followed by almost a double-digit correction.
Cooper wrote that expectations for a correction in gold prices have grown within the LBMA crowd, but no one is expecting a sharp downturn just yet.
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