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Letters to the Editor • Economy - Economics USA

Trading Stops - How They Work

From Mike on "Declare Your Independence with Ernest Hancock" Telegram Page... Stocks opened limit down and triggered circuit breakers at 7% for 15-minute hold. Will be interesting if it hits the next breaker and then the next to end trading for the day. Gold and silver are a screaming deal today as margin calls cause massive paper metal selling... If the benchmark index were to fall 13% on the day once trading resumes, it would trigger another 15-minute halt. Trading wouldn't halt if the decline occurred after 3:25 p.m. Eastern. A 20% drop in the S&P 500 would trigger what's known as a level three circuit breaker, which would stop trading for the remainder of the day.

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