Strong recovery 'already priced in' by equity traders

One belief technical traders hold dear is that the market is always right. But the substantial declines in China's A-share market in the past week may suggest that the market sometimes can be wrong, observers said.

The government's aggressive move toward a tightened monetary policy could be misread by most investors who tend to overlook the more important economic fundamentals that project a robust economic growth in 2010, Niu Wenxin, a financial commentator on China Central Television wrote in his blog.

"Investors shouldn't be too worried because the recent declines happened at the beginning of an economic growth cycle rather than a recession cycle," Niu wrote. "It's a time when you can take a short position but you should not stop seeking buying opportunities that may arise."