Yesterday's crash had a surprise element similar to the "Blackswan" Panic 1987 & Covid 2020 scenario
+ Black Monday (19/10/1987):
The cause came from the application of the automatic trading system -> Making the speed and volume of transactions increase too high.
=> Creating a chain effect when many sell orders were activated at the same time => US stocks crashed 22% in 1 day (1 week before that, SP500 had adjusted more than 10%)
+ Covid Panic (Q3/2020):
Before being announced as a global representative on March 12, SP500 also had a "1-week pre-dump" with an amplitude of more than 12%.
=> At its peak, BTC crashed more than 40% in 1 day + SP500 total amplitude decreased >35%
+ Current market:
SP500 also reacted to decrease more than 10% before + BTC decreased >30% in 2 weeks + VIX index increased from 15 -> 65 (last time was Covid Panic 2020)
=> Confirm price action on 08/05 is a surprise Blackswan event
Based on price action from previous panics, the market will recover slowly in doubt
#insight#NFA #DYOR