Did anyone ever write about why we had the crash in Oct 2018?

[zdave83]

Not only odd, It has set him up for failure. He (powel) was always worried about market instability and has given many statements like this from 2011.

Interesting that for a man concerned about market instability ... he chose to make himself one of the top sources of market instability over the past decade.

 

[destriero]

This thread went viral and The entire buy side went short. Om nom nom:
https://www.elitetrader.com/et/threads/the-spx-has-hit-a-cyclical-top.325108/

 

[Seaweed]

This thread went viral and The entire buy side went short. Om nom nom:
https://www.elitetrader.com/et/threads/the-spx-has-hit-a-cyclical-top.325108/

So where do you stand now on the original call of SPX not breaking 3020 in 2019?

 

[destriero]

So where do you stand now on the original call of SPX not breaking 3020 in 2019?

I nearly doubled my net liq on that trade. The Jan/Mar 2019 2900/3000 bear diagonal in the SPX. I am currently short a 5MM Dec 2019 3200 digital call. So no, 3020 would be hit on a trade agreement.

 

[RGLD]

most people in the market are looking for earnings and conventional measures. It’s liquidity that moves markets.
https://macro-ops.com/stanley-druckenmiller-on-liquidity-macro-margins/

Doesn't it come full circle because the Fed does react to earnings from a macro point of view? Also what do you mean by liquidity? (I know what liquidity is) but is he talking following asset classes that are increasing in volume? As a very amateurish example, the S&P is very liquid....?

 

[murray t turtle]

Also what do you mean by liquidity? As a very amateurish example, the S&P is very liquid....?

%%
Almost alWays, QQQ is also;
i never try to make every FED statement super accurate, or use one source for data.,

 

[piezoe]

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.

Perhaps if you plot the S&P using monthly bars from the 666, march low of 2009 through 2018 and then add parallel upper and lower channel lines it will become clear what the most likely reason for 2018 correction was.

It is probably better to use percentage rather than nominal numbers if you want to compare various market corrections and crashes over long periods of time. Remember the the nominal value of the dow, for example, is much greater now than it once was.

 

[Nine_Ender]

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.

Markets are forward looking; the projected trade war impact was a future drag on the economy that takes years to fully develop.

 

[RGLD]

Markets are forward looking; the projected trade war impact was a future drag on the economy that takes years to fully develop.

It's impossible to tell how much this trade war's "Future" cost is. I agree markets are forward looking but in this context makes no sense. If S&P is valued at 23x, that's what the market sees as the current balance of the politics in Washington and China? That's silly.

If you want to look at Armageddon, the whole S&P will be priced with all it's assets minus all of China... Which is hard to calculate.