Vol Crush vs Volatility Compression

The rapid compression of implied volatility that frequently occurs immediately after a highly anticipated event resolves; causes bought options to lose vega value even when the price move was favorable; the primary reason option buyers around events often lose money despite being correct on direction.

Volatility compression is a market phase in which price movement contracts significantly from recent norms, with narrowing indicator bands and tightening price ranges indicating that a high-momentum breakout is likely approaching.