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Reverse movement, usually downward, in the price of an individual stock, bond, commodity, or index. If prices have been rising on the market as a whole, and then fall dramatically, this is known as a correction within an upward trend. Antithesis of a technical rally. See: Dip, break.

Market Correction

A drop in the price of a security when that security has been overbought and therefore overpriced. Market corrections are usually short-term and are necessary for the stability of the security.


A sharp, relatively short price decline that temporarily interrupts a persistent upward trend in the market or in the price of a stock.


A correction is a drop -- usually a sudden and substantial one of 10% or more -- in the price of an individual stock, bond, commodity, index, or the market as a whole.

Market analysts anticipate market corrections when security prices are high in relation to company earnings and other indicators of economic health.

When a market correction is greater than 10% and the prices do not begin to recover relatively promptly, some analysts point to the correction as the beginning of a bear market.

References in classic literature ?
And Miss Kate read one of the most beautiful passages in a perfectly correct but perfectly expressionless manner.
When she had entirely forgotten the facts which would enable her to answer a question fully and conclusively, she commonly had some original theory to expound; it was not always correct, but it was generally unique and sometimes amusing.
I had not long been a reader of the "Liberator," before I got a pretty correct idea of the principles, measures and spirit of the anti-slavery reform.
The expression of the eye is most correct, but Miss Smith has not those eyebrows and eyelashes.
I have seen a great deal of him, have studied his sentiments and heard his opinion on subjects of literature and taste; and, upon the whole, I venture to pronounce that his mind is well-informed, enjoyment of books exceedingly great, his imagination lively, his observation just and correct, and his taste delicate and pure.
She was pretty too, if my recollections of her face and person are correct.
The whole extent of this prince's dominions reaches about six thousand miles in length, and from three to five in breadth: whence I cannot but conclude, that our geographers of Europe are in a great error, by supposing nothing but sea between Japan and California; for it was ever my opinion, that there must be a balance of earth to counterpoise the great continent of Tartary; and therefore they ought to correct their maps and charts, by joining this vast tract of land to the north-west parts of America, wherein I shall be ready to lend them my assistance.
And because we have all to pass through a state of infancy to manhood, and have been of necessity, for a length of time, governed by our desires and preceptors (whose dictates were frequently conflicting, while neither perhaps always counseled us for the best), I farther concluded that it is almost impossible that our judgments can be so correct or solid as they would have been, had our reason been mature from the moment of our birth, and had we always been guided by it alone.
The scheme of revising the constitution, in order to correct recent breaches of it, as well as for other purposes, has been actually tried in one of the States.
Imagine a vast sheet of paper on which straight Lines, Triangles, Squares, Pentagons, Hexagons, and other figures, instead of remaining fixed in their places, move freely about, on or in the surface, but without the power of rising above or sinking below it, very much like shadows -- only hard and with luminous edges -- and you will then have a pretty correct notion of my country and countrymen.
Further, if one thing is said to be correlative with another, and the terminology used is correct, then, though all irrelevant attributes should be removed, and only that one attribute left in virtue of which it was correctly stated to be correlative with that other, the stated correlation will still exist.
I was correct in saying you were either a saint or very much resembled one.