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Sit tight for a few days. If it still stays bad, compare your linking profile to competitors, maybe there is something shady in there (not accusing you of anything) that Google caught outside of a major update. They adjust their algorithm about 500 times a year according to a recent video, so chances are there are daily minor changes. Could be a fluke, too. We had rankings drop down from 5/6  to 10 for a week, and promptly bounce back up again without any interference.

Hello Zeal Digital, I use a CDN (Content Delivery Network) for images, CSS and javascript. Doing that adds only about $10 to cost per month for a site that had around 800,000 pageviews per month. You have complete control over the images. If there is a problem, you can force the CDN to flush a file and reload it from the source. You add code to your .htaccess file that tells the CDN how long to store images before fluching them and getting a new copy. It is all automated, there is generally no work for you to do. I host with softlayer.com and this is part of their service. The change from self-sourced images, css and scripts had a massive improvement on the server. it is a 16-processor linux box with twin 15,000rpm SCSI drives and 12Gb RAM - it is quite fast! Page delivery times improved by 1-2 seconds. The server now is so lightly loaded that it could be downgraded to save more money. It has zero effect on SEO. The CDN is accessed using a CNAME. -   static.domain.com  - so don't worry about it looking like components are from other places. The CDN has servers all over the world, so no matter where the visitors are, it is only a few hops for them to get most of the content, making it much faster for someone in Australia who would normally pull images from a server in the USA. Your only problem with Amazon S3 is that they have crashed it a few times, but other than that, it is a good thing to do. I wouldn't advise them to self-host, unless you want to increase their costs, server loading and page delivery times.