Merrill Lynch Exec. Predicts Further Correction In Markets

Hedge funds were no doubt affected by the grumbling in the markets in May, with many funds seeing significant losses. But while preliminary results show that June is proving kinder for hedge funds, Mary Ann Bartels, chief market analyst and head of technical analysis at Merrill Lynch, doesn't think that we are out of the woods just yet. 

"The market is extremely oversold and there are a lot of shorts, so we can get a short covering rally or a rally from a very over-sold condition," said Bartels, "but we don't think that the corrective process is completed yet and we are still looking at the 15-20% correction that we talked about earlier this year from peak to trough in the S&P500" (FINalternatives 1/13/06).