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Stock market crash - Black Monday - October 1987
On this page you will find charts, which are illustrating the trends of important indicators during the stock market crash of 1987 ("Black Monday" - 19.10.1987).
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Current stock and bond market timing signals indicating the actual weekly trading positions of our stock and bond trading systems - switching systematically between a full investment position (buying stocks or bonds) and a cash position.
Some possible reasons for the stock market crash of 1987 and for the rapid psychological shift of the market participants:
rapidly increasing short term US interest rates (the annualized yield of 3M US Treasury Bills increased from 5.30% on 20.01.1987 to the high print of the year: 7.19% on 14.10.1987 - an increase of 189 basis points)
rapidly increasing long term US interest rates (the yield of 30Y US Treasury Bonds increased from the low print of the year: 7.29% on 09.01.1987 to the high print of the year: 10.25% on 19.10.1987 - an increase of 296 basis points)
weakening US dollar (=falling against most major foreign currencies)
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