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A Reminder On Market-Wide Circuit Breakers: A 7%+ Market Drop Is Needed To Halt Trading

Tyler Durden's picture




 

As a quick reminder, the old marketwide circuit-breaker system where a drop of over 2,400 points in the DJIA was needed to close the market after 2 pm no longer exists. Instead, the SEC revised its market-wide circuit breakers as follows...

Revised Market-Wide Circuit Breakers - The securities and futures exchanges have procedures for coordinated cross-market trading halts if a severe market price decline reaches levels that may exhaust market liquidity. These procedures, known as market-wide circuit breakers, may halt trading temporarily or, under extreme circumstances, close the markets before the normal close of the trading session.

 

Under the revised rules approved by the SEC, market-wide circuit breakers will provide for cross-market trading halts during a severe market decline as measured by a single-day decrease in the S&P 500 Index. A cross-market trading halt can be triggered at three circuit breaker thresholds—7% (Level 1), 13% (Level 2), and 20% (Level 3). These triggers are set by the markets at point levels that are calculated daily based on the prior day’s closing price of the S&P 500 Index.

 

A market decline that triggers a Level 1 or Level 2 circuit breaker before 3:25 p.m. will halt market-wide trading for 15 minutes, while a similar market decline “at or after” 3:25 p.m. will not halt market-wide trading. A market decline that triggers a Level 3 circuit breaker, at any time during the trading day, will halt market-wide trading for the remainder of the trading day.

 

These revisions to the market-wide circuit breakers will be implemented on February 4, 2013. Until then, market-wide circuit breakers will continue to operate under the old market-wide circuit breaker rules which use: circuit breaker thresholds of 10% (Level 1), 20% (Level 2), and 30% (Level 3); and the Dow Jones Industrial Average as the reference index to measure daily market declines.

We only note the above as the market suddenly seems very intent on sending Bernanke a loud message: Untaper now, or the wealth effect gets it.

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Thu, 06/20/2013 - 15:09 | 3676167 Kreditanstalt
Kreditanstalt's picture

Why are there never "circuit breakers" when stocks are RISING?  (Or does that mean "wealth is being created"?)

Thu, 06/20/2013 - 15:10 | 3676168 redpill
redpill's picture

Bring out the deer!

Thu, 06/20/2013 - 15:15 | 3676196 12ToothAssassin
12ToothAssassin's picture

Mr Market has spoken and it has a loud voice.

Thu, 06/20/2013 - 15:21 | 3676241 Racer
Racer's picture

'market'??? No, it is the junkies screaming for their fix

Thu, 06/20/2013 - 15:22 | 3676245 Fleecer
Fleecer's picture

thinking Thurs is not the new Tues anymore.

 

Thu, 06/20/2013 - 15:23 | 3676247 Pladizow
Pladizow's picture

So 7% per day, how many days does that give the market?

Thu, 06/20/2013 - 15:25 | 3676259 clones2
clones2's picture

Man.... I just never saw this coming...

Thu, 06/20/2013 - 15:26 | 3676277 12ToothAssassin
12ToothAssassin's picture

Pladizow: 7% loss per day (relative to the day before) could go on nearly forever...

Thu, 06/20/2013 - 15:35 | 3676352 Ratscam
Ratscam's picture

ask for the Bilderberg memos

Thu, 06/20/2013 - 15:43 | 3676408 Ying-Yang
Ying-Yang's picture

Yes Ratscam.. the devil is in the details.. chuckle

Thu, 06/20/2013 - 15:52 | 3676428 TruthInSunshine
TruthInSunshine's picture

So did The Bernank say that the uber important equity index levels (that create a wealth affect as digits on paper statements increase - which somehow translates into any kind of real, lasting wealth?) were one of his official thresholds, along with those of maximizing (fake) employment and zeee price stability?

The Bernank As Interviewed By a Real Amateur of a Journalist

Bernanke In His Own, Idiotic Words

Thu, 06/20/2013 - 15:41 | 3676360 James_Cole
James_Cole's picture

OT: 

On Michael Hastings car crash:

Sorry for the thread hijack, but did anyone else see this? I just read this and it's so absurd I can't believe it. I'm not a big conspiracy theorist, but I've driven this stretch a million times and unless he had a heart attack while driving this seems impossible:

http://www.youtube.com/watch?feature=player_embedded&v=3LSY3wVuASg#at=39

http://nymag.com/daily/intelligencer/2013/06/michael-hastings-fbi-wikile...

http://maps.google.ca/maps?q=melrose+and+north+highland&rlz=1C1CHFA_enCA...

Thu, 06/20/2013 - 15:42 | 3676403 seek
seek's picture

I posted the same late yesterday. This is a much bigger story than the thin coverage would indicate.

Given that they're willing to off journalists with pretty weak cover, what's hidden and about to come out must be huge. I'm starting to believe Tice's claims that they're using domestic phone intercepts to blackmail members of congress and the supreme court may very well be true.

Thu, 06/20/2013 - 15:44 | 3676412 Ying-Yang
Ying-Yang's picture

Yeah, I read a few articles on it as well. Looks like murder to me. The car tells the tale.

Thu, 06/20/2013 - 16:20 | 3676608 DeadFred
DeadFred's picture

How long until it's determined to be a suicide, the body is cremated and the car's debris is 'accidentally' sent to the smelter? Of course that's as paranoid as the ZH poster that suggested Seal Team 6 should watch out for accidents after they were credited with taking down Osama. I apologize for the lapse.

Thu, 06/20/2013 - 15:55 | 3676437 James_Cole
James_Cole's picture

 

 

When I read about his death originally I thought it sad that he'd made it through so many war zones only to end up a victim to the 405 or something. And then I read the story today and see the video footage. Noooo way that was a simple car accident. 

First, it would be extraordinarily difficult to hit one of those trees as they're so spread out, second North Highland is basically a straight line for ages at that point so even if you were dead drunk you'd need to have a distraction to slam into a tree, third look at the angle of the car - it's basically perpendicular to the street, makes no sense.

I guess there's the possibility the car suddenly blew up all on it's own while he was pulling a weird manoeuvre, but this set up is very very odd. 

 

 

Thu, 06/20/2013 - 16:17 | 3676587 robertocarlos
robertocarlos's picture

I'm not an accident expert but why are the motor and transmission 50 yards behind the tree he wound up rested against. That is a nasty scene. And somehow the Miller Lite bottle on the grass is not broken.

Thu, 06/20/2013 - 16:40 | 3676721 James_Cole
James_Cole's picture

If nothing else, definitely pokes a hole in the idea that those Mercedes C class are super safe.

This story also comes after the possibility of TWA 800 being reopened as an 'external explosion' investigation. 

Conspiracy theorists are having a good couple weeks. 

Thu, 06/20/2013 - 16:43 | 3676738 Ignatius
Ignatius's picture

I think it's called conspiracy fatigue and I feel it coming on.

Thu, 06/20/2013 - 18:44 | 3677144 Bay of Pigs
Bay of Pigs's picture

Don't worry James, at some point you'll catch up with the rest of us on the "conspiracy theories".

This place is full of intelligent and well read people. Sane, sober and serious as a heart attack too. You would do well to keep an open mind around here.

Thu, 06/20/2013 - 20:19 | 3677366 James_Cole
James_Cole's picture

I am open-minded to persuasive arguments, just dont see pms the same way a lot of other folks here do (and get a lot of grief over it).

Thu, 06/20/2013 - 16:19 | 3676599 Ignatius
Ignatius's picture

Forget that it "sounded like an explosion", NIST will soon issue a report that this was a classic example of a car experiencing 'total progressive collapse' and ejecting its engine and transmission 50-60 yards down the street.

Did we mention that Hastings just happened to piss off some powerful people?

Thu, 06/20/2013 - 16:33 | 3676690 WillyGroper
WillyGroper's picture

Do you suppose his passport survived the inferno?

Thu, 06/20/2013 - 18:31 | 3677095 MarsInScorpio
MarsInScorpio's picture

seek

 

You wrote, "I'm starting to believe Tice's claims that they're using domestic phone intercepts to blackmail members of congress and the supreme court may very well be true."

 

Of course it's true - don't be naive. What do think the NSA is all about?

 

You read ZH and don't underestand these people play for keeps????

 

There's a lot of money on the table for the Military-Industrial-Orwellian Complex . . .

-30-

Thu, 06/20/2013 - 17:38 | 3676942 Overfed
Overfed's picture

Drone-strike or TOW missile? Garden-variety car-bomb? Hmmmmm.....

Thu, 06/20/2013 - 16:49 | 3676760 Bobportlandor
Bobportlandor's picture

Forever = 23 days from 15,000

Thu, 06/20/2013 - 15:23 | 3676252 Hippocratic Oaf
Hippocratic Oaf's picture

Lies-man and money honey and pisani ask........

 

'so, you buy this dip'?

 

idiots

Thu, 06/20/2013 - 15:53 | 3676458 SheepDog-One
SheepDog-One's picture

They can go ahead and buy all they like, I wouldn't touch any of this garbage ever again myself.

Thu, 06/20/2013 - 16:23 | 3676628 DeadFred
DeadFred's picture

If you forgot to buy the dip don't worry, there is pretty more dip to come.

Thu, 06/20/2013 - 15:14 | 3676193 malikai
malikai's picture

It won't be meaning that on Zero-Day. Whenever that may arrive.

Thu, 06/20/2013 - 20:55 | 3677453 Buck Johnson
Buck Johnson's picture

"Untaper now, or the wealth effect gets it".  I totally agree with this, and that is why the taper effect will continue.

Thu, 06/20/2013 - 15:09 | 3676170 buzzsaw99
buzzsaw99's picture

It looks so real, almost like what a free market would do.

I can't believe it's not butter!

Thu, 06/20/2013 - 15:10 | 3676174 redpill
redpill's picture

Don't worry, the PPT will make sure the close still gets banged.

Thu, 06/20/2013 - 15:21 | 3676244 Al Huxley
Al Huxley's picture

If by 'banged' you mean fucked, then sure.

Thu, 06/20/2013 - 15:27 | 3676278 Unprepared
Unprepared's picture

"butter" will come handy in this case.

Thu, 06/20/2013 - 15:10 | 3676172 Dareconomics
Dareconomics's picture

Imagine if he called an end to QE rather than a slowdown:

http://dareconomics.wordpress.com/2013/06/20/around-the-globe-06-20-2013/

Thu, 06/20/2013 - 15:28 | 3676291 insanelysane
insanelysane's picture

Exactly.  The ships settings are:

Buy All

Buy Moar

Buy Some

Don't Buy

Sell Some

Sell Moar

Sell All

 

Imagine when they start selling....

Thu, 06/20/2013 - 15:49 | 3676435 Divine Wind
Divine Wind's picture

 

 

Brilliant.

I would like to see William Banzai take a crack at designing just such a panel.

Thu, 06/20/2013 - 15:55 | 3676469 SheepDog-One
SheepDog-One's picture

They imagine someone is out there to buy what they've bought over the last 5 years? I just don't see it. 

They can't sell, everyones broke.

Thu, 06/20/2013 - 15:11 | 3676175 Cugel
Cugel's picture

Bring out that goddamn deer Tyler.

Oh, have I been waiting for it.

Thu, 06/20/2013 - 15:45 | 3676420 camaro68ss
camaro68ss's picture

when was there two deer in two days?

Thu, 06/20/2013 - 15:46 | 3676422 Ying-Yang
Ying-Yang's picture

If no deer then bring back the Brazillian Grannies

Thu, 06/20/2013 - 15:12 | 3676180 ekm
ekm's picture

Anybody knows whether POMO occurred today at all?

Thu, 06/20/2013 - 15:19 | 3676229 reload
reload's picture

Nothing settled today - but there was an `operation date` today 20th june for $2.75-$3.5 billion. That settles tomorrow.

Thu, 06/20/2013 - 15:21 | 3676240 ekm
ekm's picture

Thx a lot

Thu, 06/20/2013 - 15:24 | 3676255 kito
kito's picture

Poor Old Market Optimists............................

Thu, 06/20/2013 - 15:12 | 3676182 azengrcat
azengrcat's picture

Haha where is the SLVr breaker?

Thu, 06/20/2013 - 15:15 | 3676201 Being Free
Being Free's picture

GLD and SLV halt after market declies of 120%.

Thu, 06/20/2013 - 15:17 | 3676212 dobermangang
dobermangang's picture

Silver is not doing well.  SLW is down over 10%.

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