The level of panic that we witnessed on Wall Street on Wednesday was breathtaking. After a promising start to the day, the Dow Jones Industrial Average started plunging, and at the close it was down another 608 points. Since peaking at 26,951.81 on October 3rd, the Dow has now fallen 2,368 points, and all of the gains for 2018 have been completely wiped out. But things are even worse when we look at the Nasdaq. The percentage decline for the Nasdaq almost doubled the Dow’s stunning plunge on Wednesday, and it has now officially entered correction territory. To say that it was a “bloodbath” for tech stocks on Wednesday would be a major understatement. Several big name tech stocks were in free fall mode as panic swept through the marketplace like wildfire. As I noted the other day, October 2018 looks a whole lot like October 2008, and many believe that the worst is yet to come.
But in the short-term we should see some sort of bounce once the current wave of panic selling is exhausted. During every major stock market crash in our history there have been days when the stock market has absolutely soared, and this crash will not be any exception.
If we do see a bounce on either Thursday or Friday, please don’t assume that the crash is over. Most key technical levels have already been breached, and even a small piece of bad news can send stocks plunging once again.
On Wednesday there really wasn’t anything too unusual that happened, but stocks cratered anyway. Here is a summary of the carnage…
-The Dow Jones Industrial Average plummeted 608 points on Wednesday.
-The Dow is now down 7.1 percent for the month of October.
-The S&P 500 has now fallen for 13 of the last 15 trading days.
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