Has The Correction Started?

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Europe's spreading debt crisis-combined with an overdue stock pullback and the prospect of the Federal Reserve withdrawing its economic support-added up to one thing Tuesday: FEAR!
Investors have used similar market drops in recent months as buying opportunities. But with a fresh set of concerns and persistent calls for a correction that has yet to materialize, this time could be different.

Itz highlighted in yesterday's blog post, the divergence between copper prices versus gold's? That money was finding safety, the action today was money flowing towards the US Dollar. Look at the markets action this week, one needed Dramamine. An Euro agreement finally came together over the weekend, but its ballooning size of $144 billion has investors worried that Europe would have an even tougher time assembling an aid package if a larger country such as Spain or Portugal were to get in trouble. Traders are concerned that weakening economies in Europe could jeopardize the recovery in this country. Bottom line the numbers just don't work out.

China's stocks slid Tuesday to a seven-month low after the government hiked bank reserve requirements, sparking concern about profits and the economy. This shows the central bank is still tightening the money supply and worrying about inflation and an asset bubble.
But its not like all this news was a surprise, traders knewe about Europe, China and the Fed. It just seems like everything all of a sudden weighed in on the markets, along the the terrorist threat in NYC, the BP~Gulf oil leak. Itz has been repeatedly warning that a sell off was very over due and that a catalysts was needed.
The only underlying upcoming event that may either add to the selling or reverse it is the monthly Jobs Report this Friday.

API DATA:
Crude oil inventories rose by 2.951 million barrels of oil in the week to April 30, Washington-based trade group The American Petroleum Association (API) said Tuesday. The increase was above expectations; analysts surveyed by Platts had expected an increase of 1.54 million barrels. Gasoline stocks rose by 1.84 million barrels, also above expectations as the analysts polled had predicted an increase of 200,000 barrels. Stocks of distillates, which include heating oil and diesel, rose by 1.3 million barrels, under estimates of a rise of 1.89 million barrels. The U.S. Energy Information Administration (EIA) reports its more closely watched data Wednesday at 10:30 a.m. Eastern. API Link

ITZ PIX ~~ "On The Radar"  Walter Energy (WLT)  Technically looking very attractive. Just reported a not so good earnings report last week, BUT the outlook looks promising. Stock and sector oversold.
"We are pleased with our coking coal contract prices for this year," said CEO Leonard. "Coupled with record pricing on carryover tons from 2008-2009 and our expanding production base, Walter Energy is positioned for an excellent year."
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