Warnings of a scenario repeat.
🌀 Is history repeating itself?
Current conditions resemble what happened before the great crash on 'Black Monday' in 1987, prompting some to ask: Are we on the brink of a new violent correction?
In 1987, the picture was as follows:
U.S. President Ronald Reagan pressured the central bank to lower interest rates.
The dollar has started to lose its purchasing power.
Stock prices were at inflated levels.
🔻 Then came October 19, and the Dow Jones index lost more than 22% in just one day.
And today in 2025, we see similar signals, albeit with slightly different circumstances:
The U.S. dollar index is recording its worst performance in 3 years.
Trump, returning to the political scene, calls for a rapid rate cut.
Stocks are still at very high peaks.
And there's a new player on the scene: daily options (0DTE), which now represent more than one-fifth of the options market!
⚠️ These short contracts make the market very sensitive to any news or sudden movements. A simple statement from the Fed or a slight change in the dollar could trigger a massive sell-off, due to the need for immediate moves from institutions to cover risks.
But let's clarify an important point:
🔎 In the long term, there is no direct and stable relationship between the movement of the dollar and the profits of major companies.
In other words, the dollar is not an accurate mirror of stock performance.
However... markets do not move solely on numbers, but on the narratives that people believe.
And today, the dominant narrative says that the market is fragile, and that rapid trading and short contracts could turn any tremor into an earthquake.
📌 We are not saying that we will witness a crash like in 1987, but... as they say:
History does not repeat itself, but it often resembles itself.
In the markets, this similarity alone may be enough to ignite the storm.
