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Blackswan

10 Black Swan Events that Shook the marketsBlack Swans are highly unpredictable events that go beyond what is usually expected of a situation. One definition I like is this. A Black Swan is where an event can cause the market to move 10 standard deviations away from the norm. When this happens they could potentially have severe and wide-reaching consequences. You’ll see the market will jump erratically and even cause a halt in trading activity completely. So when you spot a Black Swan. Just take it easy from trading the markets that can be affected. Here are 10 Black Swan Events that I can think of that had an impact on the markets. 2008 Global Financial Crisis Triggered by the collapse of the US housing market, it led to a worldwide banking crisis and severe global economic downturn. COVID-19 Pandemic An unprecedented global health crisis that had significant repercussions on global economies and markets in 2020. Dotcom Bubble Burst (2000) The dramatic rise (due to greed and optimism) and fall (due to fear and panic) of internet companies in the late 1990s led to a severe market correction. Brexit (2016) Britain’s unexpected decision to leave the EU had immediate impacts on global markets. Japanese Asset Price Bubble Burst (1992) This led to a lost decade of economic stagnation in Japan. (Have you seen the Nikkei! And can you imagine holding stocks from 1992?) Swiss Franc Unpegging (2015) The Swiss National Bank’s sudden decision to remove the cap on the Franc’s value against the Euro led to extreme currency volatility. (Forex trading was a nightmare seeing some prices drop hundreds of pips). September 11 Attacks (2001) The terrorist attacks had immediate and long-term effects on global economies and markets. (I was too young to worry so I missed this one.) Fukushima Nuclear Disaster (2011) Triggered by a massive earthquake and tsunami, it had significant impacts on global energy markets. (I remember holding oil stocks while driving. And I came home to R120,000 loss). Flash Crash (2010) The US stock market crash, triggered by a high-frequency trading algorithm, sent a financial shockwave around the world. (Fat fingers caused by unknown factors). Oil Price Negative (2020) For the first time in history, the price of US oil turned negative due to low demand during the COVID-19 pandemic. Which Black Swan event affected you the most?
JSE:J200Education
by Timonrosso
10 Black Swan Events that shook the marketsBlack Swans are highly unpredictable events that go beyond what is usually expected of a situation. One definition I like is this. A Black Swan is where an event can cause the market to move 10 standard deviations away from the norm. When this happens they could potentially have severe and wide-reaching consequences. You’ll see the market will jump erratically and even cause a halt in trading activity completely. So when you spot a Black Swan. Just take it easy from trading the markets that can be affected. Here are 10 Black Swan Events that I can think of that had an impact on the markets. 2008 Global Financial Crisis Triggered by the collapse of the US housing market, it led to a worldwide banking crisis and severe global economic downturn. COVID-19 Pandemic An unprecedented global health crisis that had significant repercussions on global economies and markets in 2020. Dotcom Bubble Burst (2000) The dramatic rise (due to greed and optimism) and fall (due to fear and panic) of internet companies in the late 1990s led to a severe market correction. Brexit (2016) Britain’s unexpected decision to leave the EU had immediate impacts on global markets. Japanese Asset Price Bubble Burst (1992) This led to a lost decade of economic stagnation in Japan. (Have you seen the Nikkei! And can you imagine holding stocks from 1992?) Swiss Franc Unpegging (2015) The Swiss National Bank’s sudden decision to remove the cap on the Franc’s value against the Euro led to extreme currency volatility. (Forex trading was a nightmare seeing some prices drop hundreds of pips). September 11 Attacks (2001) The terrorist attacks had immediate and long-term effects on global economies and markets. (I was too young to worry so I missed this one.) Fukushima Nuclear Disaster (2011) Triggered by a massive earthquake and tsunami, it had significant impacts on global energy markets. (I remember holding oil stocks while driving. And I came home to R120,000 loss). Flash Crash (2010) The US stock market crash, triggered by a high-frequency trading algorithm, sent a financial shockwave around the world. (Fat fingers caused by unknown factors). Oil Price Negative (2020) For the first time in history, the price of US oil turned negative due to low demand during the COVID-19 pandemic. Which Black Swan event affected you the most? Let me know in the comments?
TVC:SA40Education
by Timonrosso
2
Black Swan Event: The Biggest Crypto Market Risk!In today’s article, we will be discussing a risk known as Black Swan Event. Now what is the Black Swan and why it is considered as the most unexpected event in the course of any economic crisis is the greater factor to be discussed. The most unexpected event that has the maximum possibility to occur in the market is called Black Swan, this term was first coined by NYU professor and economist Nassim Nicholas Taleb. The main attributes that shape the possibilities of Black Swan events: Unpredictability Potential Severities Widespread impact According to Taleb: A black swan is an unpredictable event that is beyond what is normally expected of a situation and has potentially severe consequences. They are impossible to predict due to their extreme rarity, yet have catastrophic consequences, it is important for people to always assume a black swan event is a possibility, whatever it may be, and to try to plan accordingly. Some believe that diversification may offer some protection when a black swan event does occur. Black swan events are characterized by their extreme rarity, severe impact, and the widespread insistence they were obvious in hindsight. Extrapolating, using statistics based on observations of past events is not helpful for predicting black swans, and might even make us more vulnerable to them. The last key aspect of a black swan is that as a historically important event, observers are keen to explain it after the fact and speculate as to how it could have been predicted. Such retrospective speculation, however, does not actually help to predict future black swans as these can be anything from a credit crisis to a war. What is the impact on Institutional markets? We know that somehow, we can use normal factors of prediction and probability over mass numbers of people like the result predicting based on Normal distribution curve, for such things, even the extrapolation method is not working. Hence Black Swan can take the market in any form that is not predefined, that can attack a market with several forms like crashing of prices and regulatory risk of digital exchanges. What are the two different types of Black Swan risk? Black Swan occurs within two types one is the positive impact and another one is a negative impact, now the inability to predict the accurate possibilities is the driving force behind the execution of the Black Swan event. Any clampdown on the trading of cryptocurrencies and other digital money can directly crash the prices of other currencies. The crackdown of Cryptocurrency exchanges by any third parties or other factors can also be counted as the Black Swan effect, many particular exogenous events can be forced to occur like: Inverse Volatility The crackdown of Crypto exchanges Regulatory risk of Crypto exchanges Low liquidity and low trading volume Having said that, 2022 has been the year of the “Black Swan” throughout the world of cryptocurrency. From the fall of LUNA to the insolvency of 3AC, Celsius, FTX and now BlockFi, the market has taken major hits in value and credibility. Each one of these events seemingly was viewed as a once in a lifetime event. To sum up, the Black Swan event is described in the following summarized manner: This event is so rare that it has many unknown possibilities occurring suddenly. Also, the impact is so huge that it can have a catastrophic effect. The hindsight conclusion if the prediction comes as true. Conclusion At last, one could conclude that many events could turn into a Black Swan in crypto trading such as, Network Congestion where everyone is rushing to have Ethereum and it subsequently raises the price of gas. In this case, when Black Swan occurs, the problem increases tenfold times and also this affects the liquidation process and also low-value transfers can simply attack the blockchain system. If you liked it, make sure to support with a like, follow and a comment! Best Regards, CryptoQueens.
Education
by Crypto_Queens_Official
23
📌BLACK SWAN IN Financial Markets ❗❗🆘The last time that the DXY index crossed the 104 ,was after the stock market bubble burst in 2000! Usually when the dollar goes up, equity and crypto and other assets decline in value - there is an inverse relationship...realizing that the stock or crypto market is currently at levels where some are calling for a bear market must always consider unexpected scenarios (Black Swan)! Black Swan Events : The concept of black swan events was popularized by the writer Nassim Nicholas Taleb in his book, The Black Swan: The Impact Of The Highly Improbable (Penguin, 2008). The essence of his work is the world is severely affected by events that are rare and difficult to predict. The implications for markets and investments are compelling and need to be taken seriously. Some Example for black swan that turned the financial markets upside down! -The Great Depression of 1929 A prime example of the Black Swan and one of the most devastating events in history was the Great Depression of 1929-1933. This event was so intense that most economists use it to describe the impact of financial crises on the global economy. The Great Depression in the United States began with the stock market crash on October 29, 1929, also known as Black Tuesday. This sudden collapse devalued the global stock market and severely slowed the growth of the global economy. -The Asian Financial Crisis of 1997 One recent example of a black force in financial markets was the 1997 Asian financial crisis. Formerly known as the "Asian Tigers" and the "Asian Economic Miracle," the countries saw their currency and stock markets depreciate by 70 percent. Indonesia, South Korea and Thailand suffered the most from the crisis, followed by Hong Kong, Laos, Malaysia, and the Philippines. Singapore, Taiwan and Japan were also relatively less affected by the crisis than other countries. -The Dot-Com crisis of 2000 One of the strongest black events that most stock traders remember happened on April 14, 2000. When the Nasdaq Composite Index fell 9 percent, ending the weekend with a 25 percent decline. The .com bubble, also known as the Internet bubble, emerged in the stock market in the late 1990s, largely due to excessive speculation in Internet-related companies. The advent of the Internet and the widespread adoption of computer technology have led to the emergence of new Internet-focused companies such as Pets.com, Webvan and Boo.com. By 1997, approximately 35 percent of all American households owned a personal computer, reflecting the popularity of the information age. -The Great Depression of 2008 One of the recent events of the Black Swan was the Great Depression of 2008, also known as the Global Financial Crisis. This severe financial crisis began with the housing market bubble in the United States and quickly spread to other parts of the world. Commercial banks took out huge risks with mortgage-backed securities that plummeted in value after the US housing bubble burst. Many economists consider the 2008 financial crisis to be the worst economic collapse since the Great Depression of 1929. The Financial Services Renovation Act of 1999, also known as the Gramm-Leach-Bliley Act, allowed banks to use customer deposits to invest in financial derivatives. Mortgage-backed securities were one of those derivatives in which banks took a lot of risks by lending to owners (even unreliable owners). The TED spread (in red), an indicator of perceived risk in the general economy, increased significantly during the financial crisis, reflecting an increase in perceived credit risk. The TED spread spiked up in July 2007, remained volatile for a year, then spiked even higher in September 2008, reaching a record 4.65% on October 10, 2008. - Flash Crash 2010 The image below is from the fall of the S&P index, which occurred in 2010 and became known as Flash Crash 2010. In this rare event, the value of the US stock market suddenly fell by $ 1,000 billion. Shares of some companies, such as P&G, fell as much as 1 cent ($ 0.01) and shares of some companies, such as Apple, rose to $ 100,000. Some organizations point the finger at supercomputers operating high-frequency (HFT) transactions and blame them. Of course, this problem took about 15 minutes, and quickly everything returned to normal. -Elimination of the Swiss franc fixed rate in 2015 Another example was the black force that hit the forex markets and affected Forex traders. This very simple example shows how sudden and unexpected events can take markets by surprise. On January 15, 2015, the Swiss central bank shocked the markets by lowering the rate of 1.20 Swiss francs against the euro. The news shook the foreign exchange markets and the Swiss franc strengthened sharply. At the same time, the Swiss national currency immediately rose 30 percent to 0.90 against the euro. -Global quarantine 2020 Unlike other examples of the Black Swan, the Corona virus epidemic, which began in China in late 2019 and spread rapidly to other parts of the world in 2020, claimed many lives. In addition to the human aspect, the disease also caused the worst recession since the Great Depression of 1929, as countries entered quarantine, the global flow of goods and services declined dramatically, and in one month, 20 million people lost their jobs in The United States lost. >>Consequences for traders You might say that events like Black Strong are very rare. But you only have to catch them once to destroy all the profits you have made in the last year or even a decade. Therefore, it is important to take all precautions. But what are these measures? For example, take your profits consistently and do not put all your life capital into one trading account. - Sometimes the loss limit does not work so should hedge your positions Have you ever read the risk acknowledgment statement given to you by an exchange or broker? Most likely you will say no and just sign it. The statement said that loss orders do not protect you in all cases and do not end your trading risk.
TVC:DXYEducation
by PRO_SMART_Trader
2
Is It The Ghost of Bitcoin Future? Or, Are those Sunny Skis ahead? 6-Apr-20 With the entire world a bit shaken by everything in it including the Support and Price of Bitcoin is now a good time to see how historically Bitcoin has turned the corner after being “clipped” by a “Black Swan”? You might say we can’t like Peter Schiff since its history is too young to reference the “2020 Black Swan” or as I like to call it, 2020BS. But what if we look back, looking back monthly to daily? What I’ve seen is it’s not as much Bitcoin Supporters but rather the Bitcoin M&T, the Marketers and Token Generators who; to hear them tell it have beaten back “Black Swans” Year in and Year out for 10 years and they are right. Fraud, Theft, Scams, Politics, Courts and Competition. But it’s time someone told them that’s not what 2020BS is all about. It’s about the “Clipping” The Yellow dashed line is a historical line identifying the center of this current long trend. Following it back to the left tells us it recently was some support and we can expect it to be a Fortress of resistance. Even now it supports both the 200 and 100 EMA’s. Will the roll back to green any time soon? I would guess not from the width of it. That would be like me trying to roll over on the floor and be just as funny. It’s certainly not getting the support it needs from the 200 and 100 EMA’s Using the Bars Pattern I selected the pattern that 2020BS cut when the Swan came through. It begins on 04 Mar 20 and ends on 13 MAR 20. I cloned and mirrored it into 5 configurations I found feasible and named them in this order I Probable, Spring Green II Possible, Moon Yellow III Maybe, Wine Red IV Probably Not, Not White V BINGO On the Kisser Red I used my polyline skills to make it easier to see. Thanks once again for letting me share my Bitcoin outlook. Remember. This is not trading advice. Follow me if you wish, share it if you want and please engage the like button and add your comments below.
BITSTAMP:BTCUSDEducation
by Flatratepete
5
Black swan events: How currencies react - YenApologies for the ominous chart title on a Monday morning, but having spent the weekend watching a few documentaries about the Japan earthquake, I was intrigued on how the currency markets react to black swan events. The Story (Japan Earthquake - Yen) ------------------------------------------------------------------------- The Tohoku earthquake hits Japan on 11th March. What we see is a sell off in USDJPY... In other words, people were selling USD to buy the Yen. Goes to show how strongly the markets believe in the Yen as a safe haven even if crisis comes to Japan. After a sharp drop, G7 central banks intervene in the markets to offer support. So they start buying USD and selling Yen, which forms an interim rally. On 04/07 BoJ announces a stimulus package, which triggers another sell off in the markets. Few days later, Fukushima nuclear alert is given which sparks a continuation of the sell off. This time it breaks the CB's support as well. I could go on but follow the notes on the chart backed up by the news sources that explains the currency moves. PS: For all those ECB QE addicts, I stumbled upon a very nice article which is worth reading and could possibly shed light on how European QE could work: Source: yhoo.it PPS: The chart is incomplete... There's just too much happening when it comes to the Yen.
Education
by justatrader
5