There are different speculations on what really happened. I've never seen the market fall so sharply in such a short amount of time - only to bounce back a few months later.... People said it was cause of Tariffs, but those were being imposed all year and the market kept rallying. It happened on Oct 1st. Ended Dec 24th... Strangely we had the worst Christmas eve in the history of the stock market. Then a 1,000 point rally? It felt like the market wanted to set a record before it stopped bleeding.
it's funny you posted this... this morning I was talking to another trader and I listed the narratives my pro boys pushed over the years. - august 2015 China slow down - Jan 2016 oil crash - nothing in 2017 - Jan 2018 inflation. - and what was the 'official' narrative for October 2018 lol... nothing right? what is happening here is that SP should be at 5000 right now, but the pro boys ran out of bs stories to push and this time in Oct 2018 they were like F it, let's just knocked it down without a narrative lol.
Unfortunately, I don't have access to the "pro boys," but my guess is that weak hands started to bail once Santa Claus rally didn't materialize ... Pros were letting it fall waiting till last moment to scoop up the bargains ... All clear in hindsight of course.
when you have stocks so undervalued, any 'crash' is artificial. capital loss is not the point, because you just end up paying more in the future due to lower base. it's about shaking short-term speculators off the rally train... my pro boys don't carry dumb money to heaven... only the true long term holders, who would hold regardless what the market does, deserve to ride the train to the promise land. that's why it's called a 'correction'... correction doesn't mean on the price, because the trend is up and SP should be at 5000 right now for it's fair value. the correction is on the chip holders... during the mark up phase, the pro boys will want the maximum chip control... so besides the true long term retail holders, they don't want short term speculators to benefit from the rally. this is why most people don't make money despite this super long bull market... they are constantly kicked out by my pro boys. makes sense?
well. If you do trading, then we had the best Christmas eve in the history of the stock market. Also we had the best Boxing day in the history of the stock market. That's why very important to read the news with a pinch of salt and do our own analysis.
It was due to mostly hawkish tone of central bankers along with the dose of tariff war news https://www.bloomberg.com/news/arti...keep-hiking-at-gradual-pace-amid-solid-growth
Crash? What "crash"? 1987 had a "crash day"... -22%. The decline, top-to-bottom in Q4, 2018, took 14 weeks. Hardly a "crash". Years ago, such a move would have been taken with aplomb as "merely noise". (Today's market players are such pussies!)
Wasn't the fed Hawkish all year? They've raised interest rates 3 times already. What was so special about this time? lol Tarriffs has been going back and forth with people buying the dip all year. I really don't get why Oct was the final nail that stopped the buying. Something magical about that meeting from the Fed that scared everyone to sell everything sharply in less then 3 months?