WHEN STOCKS START JUMPING 30–40% IN ONE DAY, HISTORY USUALLY DOESN’T END WELL
u/snapjohn ·
Reddit — r/ValueInvesting
· May 29, 2026 at 04:01
· ⬆ 1042 pts
· 💬 362 comments
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Summary
The author warns that massive one-day stock jumps (20‑40%) after earnings, exemplified by Snowflake and Dell, historically signal speculative excess and often precede market corrections.
The thesis is that current price action is detached from fundamentals, resembling past bubble cycles, though the author does not predict an imminent crash.
Quality assessment: This is a speculative commentary driven by pattern recognition and historical analogy, not a data‑heavy due diligence piece.
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maybe i’m getting old, but seeing stocks jump 20%, 30%, even 40% in a single day after earnings honestly makes me uncomfortable.
look at snowflake and dell recently. huge market cap companies adding tens of billions in value almost overnight because of ai excitement and guidance. i’m not even saying they’re bad businesses — both are solid companies — but when price action starts looking detached from reality this fast, it usually means speculation is taking over.
historically, periods where investors stop caring about valuation and only care about “future potential” haven’t ended well. every cycle feels different while you’re inside it, but the psychology always looks similar in hindsight.
again, not calling for an immediate crash tomorrow morning. but when the market starts rewarding companies with massive one-day moves like this across the board, it does make me wonder whether we’re closer to the end of the cycle than the beginning.
curious how actual value investors here are viewing this environment. are we witnessing genuine transformation from ai, or are we slowly drifting back into bubble behavior?