Most of our charts have been impacted by data today which may turn out to be the result of computer-generated results rather than true supply/demand impacts which are the basis for technical analysis. I have noticed that the impact on many of these charts is a tail on the candlestick which may- and I stress "may" not be a true representation of trader psychology. In fact, it appears that, generally speaking, no trades actually occurred at those levels. The result is a skewing of the scale of the charts and difficulty in charting, as well as the impact on moving averages, oscillators, etc.

Other than the obvious problem of not knowing for sure where the actual low of that bar should be, would any other technical issues arise from using the bar editor to adjust the lows so that the tail is removed? I would rather deal with one bar with questionable lows than the longer-term impact on the charts and indicators.

Thanks-
Rick

Based on what I've read the exchanges are "busting" all trades at 60% or more below the 2:40 PM price (or the last trade prior to 2:40 PM). You could use this to adjust the bars, although it's not an ideal situation. Realistically your buy orders were not likely to fill but your stop loss orders were :(

Thanks, Dave, for the good input. Fortunately, I was in cash except for one long commodity ETF which didn't hit my sell stop. No matter what, all those stops getting hit is going to create problems for us technicians with reguards to volume and the non-psychological factors which caused trades to trigger. Furthermore, how much volume over the next couple of days will be the result of traders re-entering the trades which they never intended to exit?

Even at 60% below the 2:40 price, volume will probably be light and non-meaningful, and bar lows at -60% is going to make some of the charting techniques difficult to use. And for those traders using Bollinger Bands... what a mess! I'm not griping- I'm just trying to figure out how to make the best of the situation. It is what it is.

Personally, I don't think you should throw out the Black (or Grey) Swans, and I'd expect more of this.

Cone I think it depends -- if the exchange throws them out by busting them then maybe you should? I guess it really depends on how they affect your systems -- if you are not going to get any trades for a month because of a price dropping to 1 cent you might want to throw it out.

Is this the United States or some third world country?

Whether or not they're going bust these trades is immaterial. It's good to have data like this to test with. It happened, and believe me I know that when it happens to me, I won't be so lucky to my trade busted (assuming I'm on the wrong side).

These are the Black Swan events. You can make or lose a fortune on them. Make sure you don't lose. Personally, I think it's a wake-up call for complacency in the market today.

It looks to me like it's setting up to happen again today. Watch out if June Crude loses 74.5.