Source
r/investing•
KillingTime56

The Stock Market is up all day and then suddenly it crashes with no news- why?

I watch the stock market during the day just for curiosity.

What I don't understand is how the stock market can be up or not doing much of anything and then suddenly it will crash for no particular reason. It just turns south at one moment of time and falls like a rock.

I go to the financial news and there seems to be no reason for it. No negative financial reports, no earning misses of a huge company, no political news, NOTHING. But in an instant, the market starts a quick extreme downward motion.

WHY?

Posted Jan 24, 2018, 5:23 PM UTC

965
baccus83•

If this is what y'all consider a crash you will literally never survive an actual bear market.

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[deleted]•

[deleted]

17
Tristanna•

I trade options on meme stocks. Bring it on!

11
IIdsandsII•

Meme economy huh?

1
Tristanna•

I made a good bit trading options on AMD , Micron and SQ last year.

3
wayoutwest7•

I love how the recent trend in this sub is “oh man you don’t know what a REAL bear market is gonna be like ho ho ho.” I didn’t even know what ‘bear market” even meant then. This market is going up and up, and for the time being most of us have been making a killing. When it corrects, it corrects—we’re all gonna survive regardless. Get off the high horse and enjoy the ride

-9†
baccus83•

How old were you in 2008?

14
iSanddbox•

Oh, my sweet, sweet child.

13
brainchasm•

Agreed. Millenials are sofa king adorable.

0†
oarabbus•

Wealthy millennials save more of their income than other generations

4
HighOnBuntCake•

Looking at savings rates of millennials vs other generations suggests they’re not so financially naive. Graduating (HS or college) in the late 2000s probably learned some of us a thing or two about weathering a storm, economically speaking.

2
DrTralfamador541•

Girl, you’ll be a woman soon.

1
kriptonicx•

"Crashes", it's barely even red...

Markets fluctuate. Sometimes that's for a political or economic reason, sometimes it's just over brought, sometimes there is seemingly no reason at all.

The only question here is why you're expecting the market to keep going up and why are you're expecting the market to be rational?

59
MasterCookSwag•

I mean generally speaking a mid day reversal is tied to some news item. In the long run it may look like(and be) noise but often a sharp change in intraday movement doesn't just materialize on its own.

16
WadeWatts2000•

God forbid a 5-10% correction happens.

16
LOL_Jamie_Dimon_Pls•

this sub is going to be ugly when a correction happens, let alone a real crash

6
[deleted]•

[deleted]

2
abdulis2cool•

There doesn't always have to be reason for a day by day move.

-0.3% is not considered falling "like a rock"

50
Tristanna•

I lost literally dozens of dollars today dude. Have some sympathy.

10
TestyFowl•

dipped to 2825 from an intraday high of 2852, close to a 1% move off the highs

2
MasterCookSwag•

You miss all of the protectionist rhetoric coming out of the administration today? Corresponds pretty closely with the reversal.

E: https://www.bloomberg.com/news/articles/2018-01-24/white-house-seen-declaring-open-season-on-dollar-at-davos

47
Leroy--Brown•

I'm hijacking the top comment to also point out that the housing report was released today. New home sales are lower than expected. This is, for obvious reasons, a pretty significant indicator of the health of the middle class economy.

20
MasterCookSwag•

Yah, first drop around 10am from housing data, second around 1145 from the trade rhetoric. Market recovers a bit in the afternoon as info is digested.

10
[deleted]•

[deleted]

1
ajgbaby•

Thank you for this, every dumbass on here just says something like “markets go up and down”

14
CalPolyJohn•

Well they pretty much do. There's always some "reason" they have to put in the headlines to get clicks. Like "markets down on falling oil prices" or "worries over interest rates" or something like that. Most of it feels like a blip on the radar that doesn't really matter, they just have to give a reason when writing daily articles.

11
MasterCookSwag•

Well they pretty much do.

The point is if momentum suddenly changes intraday there's generally a news item that accompanies that and OP is trying to figure out what said news item is. It may not be relevant in a week but saying "lol markets go up and down, can't explain that" is just a super low effort answer. People should just skip commenting that sort of useless nonsense if they don't know the answer.

14
throwawayinvestacct•

But you don't know the answer either? Why is definitively pointing to a particular possible cause more valid than the recognition that you often don't definitively know the answer?

For example, I just looked, United is the single biggest loser of the S&P today (down nearly 11%) (http://markets.businessinsider.com/index/market-movers/S&P_500). Some think that's a response to its earnings report and future planning (which is not China news):

https://www.cnbc.com/2018/01/24/united-shares-plunge-after-airline-presents-its-growth-plan.html

Indeed, several of the biggest losers on the day so far are airlines (American down almost 7%, Alaska Air Group 6.4%, Delta 5.4%, Southwest 4.5%). The market apparently didn't like United's aggressive growth plan for the coming year (despite beating earnings expectations). As the article notes in the last graph, this "could ripple out to other airlines, which might be forced to compete".

When 5 of the 6 biggest losers of the S&P on the day are airlines? I think my explanation is just as good as yours. So maybe don't be so aggressive in response to the valid recognition that the market is complex and may often be beyond simplistic explanations for a drop.

And, BTW, a thread calling a drop of a couple tenths of a percent (at its worst point, its basically back to neutral now) a "crash[]", which is described as "fall[ing] like a rock", is going to yield snarky responses.

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[deleted]•

[deleted]

1
Cop10-8•

This sub will be fun in another 08'

26
COMPUTER1313•

$ROPE is also going to be popular in WSB. 07-09' volatility is definitely going to make options look... interesting...

I could imagine someone's short getting burned by a deadcat bounce during the next recession, and being salty about it when the market continues to tumble after being served margin calls.

4
Richralph•

Go look at r/bitcoin for an indication of what it may become like (allbeit I imagine r/bitcoin has a higher portion of completely naive / stupid people who jumped on the bandwagon late than the wider investment community)

It is funny at times but also infuriating to see what some people try and preach when losing money

1
alexinawe•

FYI, I've tagged you in RES as "-0.15% = Market Crash"

I jest, but you need to seriously re-evaluate what a crash is otherwise you are going to have a difficult time if the market sees -15% or more. To give you some perspective, in 2008, the S&P 500 closed ~ -37% for the year.

11
DrTralfamador541•

Wish I could upvote this comment 100x. The S&P 500’s volatility during 2017 was under 7, which is abnormal, aberrational, and cannot possibly persist. Our expectations have become hopelessly warped. OP’s comment is a great illustration.

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[deleted]•

[deleted]

8
frosted_mini_wheats•

According to Reuters: https://www.reuters.com/article/us-usa-stocks/wall-st-heads-lower-after-wilbur-ross-comments-on-china-idUSKBN1FD1NP

8
someroastedbeef•

there was news you just didn't look hard enough

7
bear_beer_beard•

Because I finally added up all my investment accounts and realized I've made 5k on options and 5k on equities since Jan 1 and plugged it into my budgeting spreadsheet a week early. So everything had to crash, of course.

7
COMPUTER1313•

You're not satisfied with the market being up for essentially the entire month?

Oh my sweet summer child.

(There's a stock that I've been holding where they crashed by over 20%. PEGI's wind turbine assets were unable to deliver power over broken power lines in Puerto Rico, so that's a temporary 3% revenue drop. There was also speculations of the tax bill being harmful to the renewable energy's tax credits, but those harmful changes were undone. The stock barely recovered from the news about the tax bill being neutral to renewable energy instead of harmful.

I'm still waiting for the market to undo their reaction.)

3†
[deleted]•

[deleted]

0
COMPUTER1313•

PEGI is a utility company that generates most of their revenue from operating wind turbines.

Although glancing at a comparison graph, they and VWDRY are somewhat correlated since the past year (with all of the worry about the White House administration's suppression of renewable energy).

0
GAY_ATM•

Lol.

3
Sentinel947•

The Trump administration is beating its chest on trade issues.

2†
10-15-19-26-32-34-68•

€1B fine for Qualcomm

2
oarabbus•

u/killingtime56 is this a troll post? Are you intentionally exaggerating? Crash? Crash? What the fuck are you talking about man? Where's the crash? The market is killing it.

I'm going to assume you're a troll

2
stockpikr•

Believe it or not sometimes people decide to sell some and lock in some of gains they have.

2
BenInEden•

No news? Apparently you need better sources my friend.

The World Economic Forum is meeting this week in Davos (Jan 23 - 26).

The biggest players/makers in politics and finance are there. A lot of the debate so far is around the recent trends of nationalism that have been sweeping the globe. Trump's economic team (headed by Steven Mnuchin) continues to beat that drum ... European leaders (Merkel in particular) are trying to counter that argument. Just like Fed meetings a lot of people will read a whole lot into the discussions that are happening there and the market will be kinda jumpy based off of every press release and comment dropped by people who can make and shape policy.

1
[deleted]•

[deleted]

1
Ironicalogical•

I remember watching CNBC in 2008 when the market (DJIA specifically) would be down 700 one day, 500 the next, etc...losing about 4000 points in a few weeks (from about 12000 to 8000).

Today doesn't even register on my care meter.

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[deleted]•

[deleted]

0