VIX shorts scream bloody murder as stops are run, ETF markets halted
Stock-Markets / Stock Markets 2015 Mar 31, 2015 - 05:37 PM GMTZeroHedge reports that all S&P Sector ETs and VIX ETFs are halted.
One of the most crowded trades today are the VIX shorts. One way to buy VIX shares en masse is to run all the stops on the shorts, effectively making these shares available for sale. There is no control of the price at which these shares are sold when the algos are turned loose, causing massive losses among those shorts and an opportunity for some large player to load up (long) on these shares. This may not be allowed if the regulators are on the ball, as the transactions may be cancelled. But the regulators may have a hard time trying to figure out what to do, since the computer outage occurred on such a large range of ETFs.
That is why I do not employ stops on my transactions. A limit up or down could cause those positions to be sold at a loss. We can count on seeing more of this monkey business as the equities resume their decline.
Trading has halted again , for the third time.
After attempting to close the gap and failing, SPX has resumed its decline back beneath mid-cycle support at 2076.45.
At this rate, we should see the 50-day Moving Average at 2070.47 challenged this afternoon.
Regards,
Tony
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