S&P 500 drops 10% in six days, fastest correction in history

So this market drop is proof that you cannot trade the trend....trillions of dollars lost in only a week. Largest drop in market history in only a weeks time.

This market can easily drop 40-50%..and bear market chance is probably a good 90% chance. The fed will be here shortly though.

The Dow had closed at a record high on Feb. 12. It only took the S&P 500 six days to fall from an all-time high into correction levels, marking the broad index’s fastest drop of that magnitude.
 
southall said:
Market are just as dumb as ever. The risks were known a month ago. It was obvious it was going to break quarantine and spread around the world. But the dumb markets shrugged it off and continued to go higher.
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That's what confused me, the news alone meant absolutely nothing to the market as stocks kept breaking new highs for weeks. Then one day the market decides it's time to sell off and sell off it did. People are calling this a black swan but I dont believe it is.
 
There might be a coordinated rate cut across all central banks reducing rates and pumping trillions of dollars into the system but it wont be a fix to the economy, it will only create more headwinds moving forward but it might cause a quick short term powerful rally which everyone will probably end up selling anyway...this could be the first time in history you could fight the fed.
 
S2007S said:
That's what confused me, the news alone meant absolutely nothing to the market as stocks kept breaking new highs for weeks. Then one day the market decides it's time to sell off and sell off it did. People are calling this a black swan but I dont believe it is.
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What changed is it became clear over the weekend (from the Italy cluster emergence and SK cases explosion) that the virus was likely to spread worldwide despite maximum alert and strenuous containment efforts by governments. This in turn raises the prospect of 4-6 months of production shutdowns and disruption, like that seen in China, rolling across the world like a huge slow wave. Couple that with the extreme positioning and price extension seen up to last week, and here we are.

Note that there are many ways that things could turn out less bad than the market seems to expect, and the virus effect has an expiration date.
 
S2007S said:
People are calling this a black swan but I dont believe it is.
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Its a black swan event because no one was saying on ET (or anywhere else) on the first of Jan 2020. "This year the the markets will crash and the catalyst will be a global pandemic"

I was actually thinking the market could crash this year due to some type of black swan event, I just didn't know which type of event it would be.

Its like the crash of 08. I remember there was some small sell off, lasted a day or two, in Feb 2007 related to subprime mortgages, the markets shrugged it off for another 6 months after that and it was only around august 2007 when things started to get volatile.
 
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S2007S said:
So this market drop is proof that you cannot trade the trend....trillions of dollars lost in only a week. Largest drop in market history in only a weeks time.

This market can easily drop 40-50%..and bear market chance is probably a good 90% chance. The fed will be here shortly though.

The Dow had closed at a record high on Feb. 12. It only took the S&P 500 six days to fall from an all-time high into correction levels, marking the broad index’s fastest drop of that magnitude.
More...

The error in your observation is that with different time frames you got different trends.
Real question is where has the trend changed and where is it intact.
Trends vs trends vs trends and everything gets too complicated to make general statements like the ones you made.
 
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