Dec 14, 2010

About correction and more-2

About correction and more-2
(Please click on below link to Read "correction and more -part 1"
Many investors complained us that we didn’t throw enough light on ‘correction’ thing in our previous post.
Well, let’s start by defining.
To go further into anything which has attributes of understanding we must define it.
What is the meaning of correction?
We take it like this. It says ‘correction’ literally meaning ‘something of a process or act of correcting i.e. making it right which is or was hitherto wrong. But when we apply this definition or meaning to word correction and its use in markets, we do not see integrity.
{Because the word is used only for declines in prices and it is never used when prices are rising! (This translates that when markets rise after falling on wrong note, it should be called a correction!)}
……This is interesting with respect to how we want to understand the meaning. Mind it. This is not a time pass or ‘intellectual jargon busting’. We believe this whole contemplation will take us through the understanding of markets and its behaviors…….

So when there is any excess of increase in markets, it is ‘incorrect’ and need to decline i.e correct.