Hey Guys........just thought I'd gauge thoughts on a major correction this month...maybe up to 10%...to me, its more than a 50% possibility. Why?
1) Yearly cycle: we seemed to have avoided the dreaded October correction but with the 'Santa Clause' cycle coming in Dec.Jan, about now is the most statistically likely time in the yearly cycle (untill about June..hehe)
2) Subprime impact is widening in US and now Aus with the Australian market almost completely ignoring it to this stage.
3) There are now healthy imbalances with currency and interest rates.....US is discount while we are very much increasing rates......and our currency ascent is hitting our major businesses while helping consumers go further into debt putting ever more pressure on rates
4) Most of all, there are now major pockets of our market which are overvalued....specifically, mining and banks
Happy to hear thoughts on me being wrong....and we'll then let the market decide.....