The Flash Correction

31 days ago the market peaked. In nine sessions the NASDAQ 100 fell 10%. And then in the next 21, it got it all back and then some, gaining 13% over that time.

This has been a wild few weeks for stocks, but it is not unprecedented. This type of move has happened before, as shown in the chart below.

What’s interesting about the previous V formations is that they all occurred at very identifiable moments- the Russian default in the fall of ’98, the dotcom crash experienced a few of these puke and rallies, and then at the bottom of the GFC in 2009. But what story are we ascribing to what just happened?

The best I can come up with is this was a flash correction driven by many forces, but absent a single culprit.