Silver dives as another unexplained “flash crash” in the market occurs

Silver futures

Silver Futures were seen in negative positions but quickly recovered within session as another “Flash Crash” occurred. The sudden drop triggered new worries that these technical inconsistencies might happen more often.

Within the session, Silver Futures for the month of September was down by 11 percent. The September futures dropped from $16.14 to $14.34. While on Friday morning the semi-precious metal ended the session near $15.87 per troy ounce.

Traders of the session were not able to indicate any reason for the sudden drop, but instead traders considered it to be another case of a computer-driven trading that disrupted markets which happened during a period when few were actively trading.

Similarly to what happened to previous flash crashes, the drop in silver happened outside the New York business hours and closer to early hours of the Asian markets operations.

The flash crashes have been traced to derivative markets, after exchanges in stocks put limiting mechanisms to prevent the reoccurrence the 2010 crash when the Dow Jones Industrial Average plunged nearly 1,000 points then recovering a few minutes later in the session.

Bitcoin, recently also experienced a flash crash in the New York market on June 21 session. The trade dropped from $317 to 10 cents on a major U.S. based digital currency exchange market called GDAX.

And on May 4 U.S. West Texas Intermediate also dropped by almost 3% making it slip into a six-month low of $43.76 per barrel these prices remain bearish for 15 minutes before recovering in the market.


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