Why did the stock market crash? These factors are at play!

Recently, the stock market has been plummeting continuously, like a crazy roller coaster, and the reasons are quite complex.

Elon Musk has encountered issues, with reports revealing that he is under review by the U.S. military for security concerns, focusing on the technologies and sensitive information of his companies like SpaceX and Tesla. This news hit the market like a bomb, causing immediate panic. Why? Musk's business empire is enormous, deeply intertwined with national security and military technology, casting a shadow of regulation that left investors anxious, and the cryptocurrency market was also affected.

The global economic situation added to the chaos. U.S. economic policies are erratic, with interest rate hikes and debt issues causing worry; China's economy is slowing down in stages; geopolitical crises like the Russia-Ukraine conflict and U.S.-China trade frictions occasionally erupt, and even minor disturbances can shock the cryptocurrency market, triggering panic selling in the stock market.

Tech stocks are also restless, with giants like Tesla and Apple seeing their stock prices fluctuate wildly. Musk, as a key figure, influences the direction of the stock market with his words and actions. Recently, the valuation bubble in tech stocks is about to burst, and investors sensing trouble hurriedly sell off overvalued stocks, leading to a sharp decline in the market.

Additionally, retail investors, who are now thriving on social media and investment forums, are banding together, amplifying their emotions and actions' impact on the market. The recent volatility has severely affected retail investors, prompting widespread panic selling, which has intensified market fluctuations.

The cryptocurrency market's own technical corrections also joined the “frenzy.” After a prolonged rise, investors wanted to secure their profits, and selling triggered significant index adjustments. Although this is unrelated to the fundamentals, it has led to intense short-term market volatility.

In summary, the stock market crash is the result of multiple overlapping factors: the Musk incident, global economic turmoil, risks in tech stocks, retail investor panic, and technical corrections all contributing. Retail investors, during turbulent times, should avoid following the crowd, focus on risk management, and think long-term. By the way, the Musk-themed dog token in the crypto world is gaining attention; will it become the next Shiba Inu? Stay tuned.