HSI 50 points drop in 1 second

Discussion in 'Index Futures' started by RedDuke, May 17, 2007.

  1. There was a sudden 50 points drop in HSI at around 10:33:59. I have hot seen such a drop in regular session so far from expiration (I have been trading this contract for few months).

    Anyone has an idea of what could have caused it? How often does such thing happen?

    Thanks,
    redduke
     
  2. the market is dissappointed in the FED, its working its way into the equity market. The credit markets started pricing it in, with yields bumping up.

    some global players might be booking profits, expecting a intermediate term drop till the FED changes its tune.
     
  3. dtan1e

    dtan1e

    haven't u seen the hk news yesterday, LKS came out to reiterate that the china stocks a bit on the high side
     
  4. just sold some ES ..1513 retest as the asian situation progresses.
     
  5. He is more surprised by the 1 second than the 50 pts.

    Yes, it has happened often.

    Although blaming a 50 pt move 50 minutes after the Hong Kong open on disappointment in the Fed is amusing.
     
  6. I call those bars "fat fingers hitting a thin DOM".

    This is hindsight, but if you look at the 1 minute chart and put in channels, you will notice that the sequence was indicating change. It is not so clear on the 5 minute chart.
     
  7. Tums

    Tums

    the PBoC has called in the major brokerage and investment houses for a special meeting regarding the high flying stock mkt.
     
  8. I disagree sorry scarletfire. The move this morning was unusual.

    1. Big moves are usually breakouts from support or resistance and 20 pts without a tick would be large even in that situation.

    2. This move was a reversal back into the direction of the normal intraday trend. Technically on the shortest timeframes it looked like a triple top but there wasn't much volume built up and there was little volume on the move down (which promptly rebounded) so it doesn't look like it was set up ... more of a surprising downdraft when all the buyers just dropped out.
     
  9. Hi Kiwi,

    You have been trading this contract for a very long time. How often do you see such 1 second moves? I was under the assumption that the moves of this nature are around 20 points, not 50.

    Thanks,
    redduke

    P.S. Yes, it was the fact that it only took 1second that worries me, not 50 points in itself. It does not look like fundamental move, unless some news came out, but I could not find any.
     
  10. I don't recall more than one other incident where I'm sure it moved 50 points at once and that was a breakout into clear air. If you're on the side of the current thrust you generally only see a few points and even when the spread opens up around the point where your stop lies it frequently closes before any orders are filled (and, phew, often reverses without filling an order beyond your stop).
     
    #10     May 18, 2007