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Stock Market Correction
The expression, stock market correction, sounds like something was wrong and is now being fixed. Depending upon the point of view of traders and investors involved in the stock market this is sometimes the case. In general a stock market correction is a drop in stock price, usually after a rapid and/or prolonged rise. Typically a decline of as little as five percent and a much as twenty percent in the Dow Jones Industrial Average is the benchmark for a stock market correction. The decline in stock prices happens over a brief period. When stocks decline over a long period it is referred to as a bear market. Unlike bear markets stock market corrections are secondary market trends. A stock market correction is a market reversal superimposed on a steadily rising bull market. Using technical analysis tools such as Candlestick pattern formations traders are able to distinguish between a stock market correction and the start of a persistently downward, bear, market.
A stock market crash is defined as sudden steep decline in stocks prices on the stock market. While there are no particular set of rules for what defines a crash, it is generally said to occur when the percentage of loss is steep with double digits over a period of a week. They are normally caused by a combination of panic and economic factors. It may follow after a long term of positive expectations and continued price increases in stocks, or if too much borrowed money placed in the markets is not repaid. When investors feel concern or fear of a possible loss because of these conditions, it may trigger panic with mass selling of stocks.
This mass hysteria and negative sentiment on the stock market fuels a craze of selling which keeps on driving stock prices down, thus causing the stock index to suffer. Bear markets are a period where declining stock prices occur over a period of time, sometimes months or years. However, a stock market crash is often sudden and dramatic occurring over several days. Over the decades, there have been a number of crashes that have taken place, some being more severe than others.
@jaya wrote:New foreign funds would not be comes due to world economic and political situation, also in Sri Lankan political situation not so good. I hope time been that could be correct.
@monash wrote:market crash! On market correction, market going down gradually. Not like this.@jaya wrote:New foreign funds would not be comes due to world economic and political situation, also in Sri Lankan political situation not so good. I hope time been that could be correct.
If so how world market rallying from 1st January 2012 until now? Only CSE is going down. I think foreign funds who left on last year haven't returned due to unstable policies of sri lankan government, sec and central bank. They may have invested on stable markets in other countries.
At CSE in every month 1 or 2 new companies getting listed without increase of capital. So with foreigners leaving CSE, it is very challenging to overcome this situation. so fresh capital should come in order to stable this market.
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