hmmmm ... "correction" has a pretty precise meaning in this context, which technical analysis bores like me would agree is overused, but was probably appropriate in this case.
The point is that part of the reason for the fall was that there had been short selling. By yesterday, the shorts had committed almost all of their capital to the market (ie; they had maxed out their margins) and thus couldn't add to their positions any more. They thus have the incentive to close out positions, realising some gains, increasing the equity in their account, and thus increasing the amount of margin and the amount of short positions they can take out next time. To call a sharp rally in a downtrend a "correction" is actually a very bearish thing to say. That's my understanding of the term "correction" anyway, but there are considerable differences between US and UK jargon and I suspect the looser use of "correction" meaning "any sharp countertrend movement" is the one in general usage. dd -----Original Message----- From: Karl [mailto:[EMAIL PROTECTED]] Sent: 25 July 2002 07:33 To: PEN Subject: [PEN-L:28463] Market correction The market rebound. Now they are saying that the market was overdue a correction. What rubbish. When they dont know our experts drag out the correction word. A code for we dont know. Karl Carlile Communism Site: http://homepage.eircom.net/~beprepared/ ___________________________________________________ Email Disclaimer This communication may contain confidential or privileged information and is for the attention of the named recipient only. It should not be passed on to any other person. Information relating to any company or security, is for information purposes only and should not be interpreted as a solicitation or offer to buy or sell any security. The information on which this communication is based has been obtained from sources we believe to be reliable, but we do not guarantee its accuracy or completeness. All expressions of opinion are subject to change without notice. All e-mail messages, and associated attachments, are subject to interception and monitoring for lawful business purposes. (c) 2002 Cazenove Service Company or affiliates. Cazenove & Co. Ltd and Cazenove Fund Management Limited provide independent advice and are regulated by the Financial Services Authority and members of the London Stock Exchange. Cazenove Fund Management Jersey is a branch of Cazenove Fund Management Limited and is regulated by the Jersey Financial Services Commission. Cazenove Investment Fund Management Limited, regulated by the Financial Services Authority and a member of IMA, promotes only its own products and services. ___________________________________________________
