Dow down almost 1,000 today after "glitch"

909 Views 11 Replies 10 Participants Last post by Max, May 7, 2010

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Discussion Starter · May 7, 2010

CNNMoney.com Market Report - May. 6, 2010

Holy shit.

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noodles

· #5 · May 7, 2010

And people wonder why Wall Street needs regulated; they're not just greedy, they're panicky gazelles. :lol:

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The Dark Wolf

· #7 · May 7, 2010

noodles said:
And people wonder why Wall Street needs regulated; they're not just greedy, they're panicky gazelles. :lol:

:lol:

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Naren

· #8 · May 7, 2010

noodles said:
And people wonder why Wall Street needs regulated; they're not just greedy, they're panicky gazelles. :lol:

:agreed: :lol:

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I've heard a lot of talk about this "glitch" but no one's really described what happened.

My hunch, which early reports seemed to bear out, was this was driven by technical trading orders - There just happened to be a ton of stop-loss orders at and below a certain threshold, such that when normal trading brought P&G down that far, the stop loss orders triggered, causing further automated selling.

The weird thing was I had a ticker open watching Goldman Sachs, and the GS price was following the crash on a lag. At the time, it looked like something had happened somwhere and it was dragging the market down with it - I figured Greece had probably defaulted.

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343

· #10 · May 7, 2010

Drew said:
I've heard a lot of talk about this "glitch" but no one's really described what happened.

My hunch, which early reports seemed to bear out, was this was driven by technical trading orders - There just happened to be a ton of stop-loss orders at and below a certain threshold, such that when normal trading brought P&G down that far, the stop loss orders triggered, causing further automated selling.

The weird thing was I had a ticker open watching Goldman Sachs, and the GS price was following the crash on a lag. At the time, it looked like something had happened somwhere and it was dragging the market down with it - I figured Greece had probably defaulted.

That is basically what they were saying on NPR. I guess someone (Supposedly in the Citibank Chicago exchange) made a "fat fingers on keyboard" error which started the whole mess. The selling was mostly from automated system stop orders.

Proctor & Gamble lost about 38$ per share at one point and Asencia went from 40$ to 1 penny

A complete mess. Imagine what a cyber-terrorist attack on the stock system would do to the U.S. (or the world for that matter) :ugh:

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Drew

· #11 · May 7, 2010

Vegetta said:
A complete mess. Imagine what a cyber-terrorist attack on the stock system would do to the U.S. (or the world for that matter) :ugh:

Probably less than you would think. There was a ton of fear and uncertainty in the marketplace anyway, thanks to Greece, so a lot of technical traders were keeping a close eye on index performance for early signs of a default and were probably being more conservative than normal with stop-loss orders. It was primed for a fall.

And, anyway, the market recovered within 15 minutes. It was a hell of a fall, but it wasn't a permanent one and it sprung back just as fast.

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Max

· #12 · May 7, 2010

And germany gives in and loans greece a shit ton of money :lol:

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Dow down almost 1,000 today after "glitch"

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