Lookout below......!

Most all of my regular readers know that I have been calling for a correction in equities for a while now. Market Club made two videos about it already, and both times the S+P was where it still is...after all the hype about how the markets are healed and the world is saved...Adam's videos still may play out like he said.

Jamie Saettele called for it a while ago in this post. (End of April.) He uses Elliot Wave theory which is discussed in a question I found on the Elliot Wave site below. Read the post above and then read below...you might find it hard to dispute this:

How can stocks fall again if the economy is getting stronger?
-- In the major global stock market indices, from the U.S. to Europe to emerging markets, you contend that we are in a Primary Wave 2 up, and that the really nasty selling panic will ensue in the next downdraft of Wave 3. Yet, hard global economic data point to recovery globally by the end of this year. How does your Wave Principle square with the hard data, which indicate that even a retest of March 09 index lows is highly unlikely, let alone a collapse beyond them?

Answer (6/4/2009): That's exactly the kind of thinking that gets most investors buying at tops and selling at bottoms. The reality is that "fundamentals" -- such as the strong economy -- lag the stock market, not lead them. How else do you explain the fact that the DJIA topped in July-October 2007, in the midst of "goldilocks fundamentals"? Or that it bottomed in early March 2009, when the "fundamentals" were horrible? The list of examples goes on and on. That's why our April 2009 Elliott Wave Financial Forecast warned: "Primary wave 2 up is now unfolding, as the March 25 Interim Report communicated. Be prepared: In its final weeks, the advance will re-ignite some of the zaniness of 1999 and 2007... By the end of wave 2, many market followers and economists will proclaim that the bear market is dead and the boom is back. For those who felt trapped in stocks during Primary wave 1, wave 2 will offer a respectable place to exit. But we know from past experience (and the chart on page 2 of the March 2008 issue) that many will hold out for even higher prices, hoping to 'break even.'"