The Black Swan on the Financial Markets

Anyone who follows the financial markets will certainly have noticed what happened on the stock exchange. The black swan has appeared on the stock exchanges. This has never happened on the stock exchange in the 21st century. It has happened before, but never like this.

Black swan and what’s next?

Is this the end of the fall? I am not the right person to guess. However, we know one thing: the market was overheated. Investors and speculators had been waiting for a fall for a long time, but the market kept growing. And when hope for a correction faded, it came.

Many people (including me) will be licking their wounds for a long time. But objectively, it must be said that the market needed such a reset. It is never the case that everything goes up.

Read also: Patience on the road to success

Is it already a bear market? It is said that 20% falls are considered corrections, so I don’t think we can really talk about a bear market yet. However, the bulls will certainly look at what is happening in the markets with a slight distrust. So if there are increases, they will be calm and timid. In other words, the traditional climbing of the stairs.

It is also possible that the bears have not had the last word. After all, the market is unpredictable and in a panic, all kinds of things can happen.

Don’t be too greedy

What lesson can be learned by all market participants? It is not to be trifled with. If we do not manage our positions well, nothing will protect us from disaster. Not even a stop loss. Therefore, it is not worth being overly greedy and opening too large of positions. Especially in leveraged markets.