Ralph Acampora: The Market Could See a 15% Sell-off
Jack Bouroudjian, Bull and Bear Partners CEO, along with Ralph Acampora, Altaira Limited’s Senior Managing Director, were guests on CNBC with Maria Bartiromo last week. Bouroudjian was calling for a 10% correction based on his view that top line revenue growth is contracting and the notional value of the stock market has surpassed GDP.
Acampora said there could be a 15% selloff based on his analysis showing positive news is not moving the market up. Following good news out of China and Europe the last couple of weeks the market has faltered, Acampora added.
Acampora said there has been churning and heaviness amongst some of the big name stocks including Home Depot, Coca Cola, IBM, Walmart and Disney. Acampora added that he took the downside risks of the 30 DJIA stocks which indicates a downside for the Dow, “I did not make this up,” of 13,333.33, or 15% from the top to the bottom.
Acampora stated investors would be prudent to take some profits and invest the proceeds later; perhaps in two months in anticipation of a strong year-end rally.
Bouroudjian advised investors protect their portfolio up to 100% since the last two times the Fed had a changing of the guard there was a big break in the market.
Acampora cautioned that black swans can’t be predicted, but it is out there. He used the old adage, “bulls make money, bears make money, pigs get slaughtered.”
Acampora believed the Fed would be tapering, but Bouroudjian felt the economic numbers didn’t justify it.
Back in May Acampora gave his reasoning on why the bull market would forge much higher [link].