10/23/2006

Market in correction mode

After a rally which found most people on sideline and surprised, the markets seems to be in correction mode. Many stocks moved too far too fast and a reaction here is not an unusual phenomenon. Everyday new set of stocks are breaking out. Many stocks are breaking out of multi year ranges e.g KO,MLHR, LNN, MSFT etc. It is possible, but unlikely such stocks would just turn tell and go back in to range. This market might have more room to run post correction.

6 comments:

walter said...

what does correction mean nowadays?

Pradeep Bonde said...

Less painful days for shorts!!

walter said...

that's one way of putting it...

the market does the most obvious thing in the least obvious way - i wonder, if we adopt that perspective, does it mean for us...

Pradeep Bonde said...

Looks like a well planned short squeeze.

walter said...

do you follow that whole M3 thing and how much currency is being printed?

Pradeep Bonde said...

No. Most of my market modeling is based on either earning/sales/ price acceleration. I concentrate on equity selection. Macro econmics is more for fun.