What Shocks Await The Stock Market in Summer 2012?

How short the memory can be. This time last year at the start of May 2011,
the U.S. markets peaked for the year and then promptly sold off and lost 30%
through to October 2011. A similar thing happened in 2010, the S&P 500
peaked at 1217 in April, and then sold off 23% into the summer bottoming in
August.

According to Elliot wave theory, if we look at the trend from the bottom of
the 2009 on a weekly chart we can see we are embarking on the 5th wave of
the primary uptrend. This means after this wave is complete we can expect a
strong pullback.

What does this all mean?

Well, simply beware that there may be the usual slow down in the markets
over the summer period. If there continue to be worries over European
sovereign debt this may help to fuel a sell off.

We have been in a bull market for over 3 years now and the markets are just
15% to 20% off their all time highs, but the worrying thing is they have
only a partially healthy economy to support them

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