May 6 low breeched

The major equity indexes started the day much lower filling in the gap from the May 6 “flash crash” low. The S&P 500 actually took out its May 6 low before rebounding (see chart). The Dow traded within 50 points of its May 6 low.

It appears that while structural problems in the markets may have allowed the extreme price movements on May 6 to occur, the actual levels hit were not unwarranted.

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