Where were the stabilising speculators of textbook theory, who were supposed (in the textbook view) to respond to the fall in the exchange rate by recognising that, once the exchange rate was below its fundamental level, there was a profit opportunity for those who bought the currency?
In the absence of a firmly-defined “fundamental” equilibrium exchange rate, as the exchange rate fell, the market changed its view on what was the “correct” equilibrium rate. Even when most market participants agreed that exchange rates had gone too far, they recognised the possibility that they could go further still.