Bullish short-term traders might do well to take their foot off the gas Friday, with two technical analysts telling CNBC that major global benchmarks were set for a short correction over the next month.
Delving deep into the technicals, Yacine Kanoun, managing director at PivotHunters, a portfolio management firm based in the U.K., highlighted that Germany's blue chip index, the DAX (^GDAXI), has already dipped by 3 or 4 percent since last week.
He now expects further falls in the short term on both the DAX and the U.S. benchmark S&P 500 (^GSPC).
"Definitely the market is going to correct here," he told CNBC Friday. "I think the correction has started on the DAX."
U.S. stocks traded sharply in the red Friday, following a global decline in equities on renewed Greece concerns and new Chinese trading regulations, amid U.S. inflation and consumer data.
He said the expiry of options contracts-a type of financial instrument-on Friday would herald the start of a correction in the U.S., which which would follow the German bourse lower over the next month and lose 10 percent from its current peak.
Meanwhile, Steve Miley, technical strategist at TheMarketChartist.com, also told CNBC Friday that the DAX would "likely correct further and go slightly lower into next week."
He offered a bottom for the DAX of around 11,650 points, to occur sometime next week. This would mean a 6 percent drop from its peak of 12,374 points on April 10.
The index is currently at 11,998 points and has seen stellar gains of 22 percent this year on the back of quantitative easing by the European Central Bank. The S&P 500 is currently at 2,104 points and has edged 2.2 percent higher so far this year.
PivotHunters' Kanoun spoke of a "convergence" between major global benchmarks this year, especially the S&P 500 and the DAX.
"Now they are in sync, from here I think they are going to move in parallel, " he said. Miley expects the opposite for the S&P 500 and told CNBC that a "bullish leadership" could start to shift back to the U.S. and predicts new record highs into next week.
Kanoun might be cautious in the short-term, but he also believes the correction will be followed by hefty gains. The S&P 500 will finish the year near 2,200 points, he said, and the DAX could even hit 13,500 points.
Miley was even more bullish in the longer-term, arguing that the German index could hit that level before the end of the second quarter.
Giles Keating, global head of research of private banking and wealth management at Credit Suisse, conceded that there could certainly be "some volatility" ahead in global stock markets.
"It's perfectly normal in a year when the (U.S. Federal Reserve) raises interest rates for the first time in the cycle to see quite a significant pullback," he told CNBC Friday. "So at some time in the coming months we're probably set for that, but we think the trend is still gently upwards in global equities."
Keating currently has a "neutral" rating on stocks and is not adding to his portfolio.
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