The standard definition of a stock market correction is a 10 percent drop from high to low—something the S&P 500 has not technically experienced since mid-2011. But according to one noted technical analyst, stocks are currently in the throes of what he terms a "time correction."
"Whoever said that the market has to have a correction in price? You can also have a correction in time, meaning the market can just go sideways," Craig Johnson of Piper Jaffray said Monday on CNBC's "Power Lunch."
To understand what the phrase "time correction" means, one first has to is understand that stocks tend to rise over time—with the S&P 500 returning an average of 10 percent a year in the long run. A longish period of time in which stocks return little to nothing, as they have done thus far this year, represents a kind of correction after a bull run.
A period of flatness "allows all the fundamentals to catch up with the price action you've been seeing in the market," Johnson said. "It's actually a healthy thing."