Correction Spelled with a “W”

Mark Twain is credited with saying that “History does not repeat itself, but it often rhymes.” Market history is no exception. Stock markets are extremely unpredictable in short periods but we can draw clues and patterns from the past.

Stock market corrections (like the one we have been experiencing over the last several weeks) seem to rhyme. Corrections often form a “W” shape as markets drop quickly, briefly move higher, test the recent lows and then recover.