(News Affinity) Pioneering technical analyst Ralph Acampora said to MarketWatch in an interview on Friday that he feels that the coronavirus uncertainties are a catalyst for a market that had already become expensive.
“The market itself was stretched, which is true, so we were begging for some kind of correction and this is the catalyst,” he said. He is expecting that the stock market will face at least a 10% drop from its recent peak, which would meet the criteria for a bona fide correction held by most market technicians.
Acampora stated that the harm from the coronavirus is going to get worse before it resolves. It will profoundly affect the economy of China, which reported that uncertainties produced over the flu that started in Wuhan has infected 9,500 persons and taken at least 213 lives.
The disease, which has drawn comparisons with SARS, a severe acute respiratory syndrome that attacked Beijing in 2002-03 and killed 800 people.
The World Health Organization mentioned on Thursday that the virus-related outburst has become a public health emergency but didn’t call for unusual measures.
Acampora, meanwhile, remains bullish on stocks for the intermediate term.
He projects that the Dow will ultimately hit 30,000 but warns that the markets are probably going to be choppy as the 2020 elections unfold.
“I’m not negative," he said. "If you've got cash and are looking to get in, this is an opportunity."