US Stock Market Biggest Point Decline In History. Whats Next!
The Dow Jones Had Its Biggest Point Decline In History Today After A 2.5% Decline On Friday. (See Additional Charts At Bottom Of Description)
The Dow was down 1,600 points (6%) at one point of the day but ultimately closed down 1,175 points, down 4.5 percent on the day and roughly 10% from all time highs! The US Stock Market is now negative for the year after surrendering all of 2018’s gains in less than 1 week. Today we saw a global equities market sell off with the exception of a few major indices. We also saw some very suspicious and significant movement in the Bond market.. At the Dows lowest point of the day, it was down over 6% bringing it within 1% of a market shutdown. For those of you who don’t know, I will explain simply and quickly- If the market falls 7% in any single day, a protective circuit breaker will be trigger and shut down the US stock market to prevent panic selling!
Ironically, right as the Dow approached a 7% decline we saw a massive wave of buying that temporarily cut the dow losses in half- pushing the market from 1,600 points down to 800 points down in minutes! I have been doing this for a long time and I have never seen so many investors try to catch a falling knife like that! This was abnormal and definitely caused by a 3rd party trying to stop the rapid decline. This ultimately did not work and the markets sold off again.. After the closing bell at 4:00pm we saw a further sell of in after hours trading.. Today was a very significant day and a huge sign of how the year 2018 may end.
Now that we have covered todays action in the financial markets- I know many people are wondering what will happen from here. Although nothing is a guarantee, I have a couple theories on what we may see next.. My experience tells me that this type of sell of will not just end and would normally continue in a REAL market however there is also the scenario that the big boys were “running stops” otherwise known as “shaking out the weak hands". The objective behind running stops is to push the markets down hard and fast causing people to sell out of fear and others to sell their investment due to stop loss orders they have placed to protect the risk of losing more than a certain amount of their investment. This method of running stops is a serious money maker for Wall St!
After they shake the weak hands out, the market continues higher leaving the people who sold out of fear, or got their stop loss order triggered kicking themselves! Please research this term to get a full understanding of what this means if you are not sure. With that said, I would not be betting on that scenario just yet! In this game you must be patient and never jump the gun. There will always be an opportunity to make money and it is more likely to occur with patience and unemotional judgement. After seeing what we saw today, we can only expect a further decline. Until that changes we must side with the sell off. Its not everyday that action like this happens in the financial markets- In fact it is very rare in this day and age and definitely something you should not underestimate!
On a brighter note TradersNsights had the best trading day of the year so far and we hope others were able to do the same. This type of volatility can produce amazing trading opportunities for a professional trader when capitalized on correctly!
I hope everyone made out ok and if you have any questions, please feel free to ask! Stay patient, unbiased, and manage risk. Lets see how tomorrow plays out.
if you like this content please be sure to follow my 'facebook page for frequent market updates along with live trades, educational material & much more valuable content- www.facebook.com/TradersNsights/
Educational Courses- tradersnsights.myshopify.com/
Free Forex Position Size Calculator- goo.gl/forms/poie4UX3iJi6jn3I3
The Dow was down 1,600 points (6%) at one point of the day but ultimately closed down 1,175 points, down 4.5 percent on the day and roughly 10% from all time highs! The US Stock Market is now negative for the year after surrendering all of 2018’s gains in less than 1 week. Today we saw a global equities market sell off with the exception of a few major indices. We also saw some very suspicious and significant movement in the Bond market.. At the Dows lowest point of the day, it was down over 6% bringing it within 1% of a market shutdown. For those of you who don’t know, I will explain simply and quickly- If the market falls 7% in any single day, a protective circuit breaker will be trigger and shut down the US stock market to prevent panic selling!
Ironically, right as the Dow approached a 7% decline we saw a massive wave of buying that temporarily cut the dow losses in half- pushing the market from 1,600 points down to 800 points down in minutes! I have been doing this for a long time and I have never seen so many investors try to catch a falling knife like that! This was abnormal and definitely caused by a 3rd party trying to stop the rapid decline. This ultimately did not work and the markets sold off again.. After the closing bell at 4:00pm we saw a further sell of in after hours trading.. Today was a very significant day and a huge sign of how the year 2018 may end.
Now that we have covered todays action in the financial markets- I know many people are wondering what will happen from here. Although nothing is a guarantee, I have a couple theories on what we may see next.. My experience tells me that this type of sell of will not just end and would normally continue in a REAL market however there is also the scenario that the big boys were “running stops” otherwise known as “shaking out the weak hands". The objective behind running stops is to push the markets down hard and fast causing people to sell out of fear and others to sell their investment due to stop loss orders they have placed to protect the risk of losing more than a certain amount of their investment. This method of running stops is a serious money maker for Wall St!
After they shake the weak hands out, the market continues higher leaving the people who sold out of fear, or got their stop loss order triggered kicking themselves! Please research this term to get a full understanding of what this means if you are not sure. With that said, I would not be betting on that scenario just yet! In this game you must be patient and never jump the gun. There will always be an opportunity to make money and it is more likely to occur with patience and unemotional judgement. After seeing what we saw today, we can only expect a further decline. Until that changes we must side with the sell off. Its not everyday that action like this happens in the financial markets- In fact it is very rare in this day and age and definitely something you should not underestimate!
On a brighter note TradersNsights had the best trading day of the year so far and we hope others were able to do the same. This type of volatility can produce amazing trading opportunities for a professional trader when capitalized on correctly!
I hope everyone made out ok and if you have any questions, please feel free to ask! Stay patient, unbiased, and manage risk. Lets see how tomorrow plays out.
if you like this content please be sure to follow my 'facebook page for frequent market updates along with live trades, educational material & much more valuable content- www.facebook.com/TradersNsights/
Educational Courses- tradersnsights.myshopify.com/
Free Forex Position Size Calculator- goo.gl/forms/poie4UX3iJi6jn3I3
Comment:
Head & Shoulders With Double Bottom & Engulfing Candle Entry.
