I know some people who got right royally screwed by the cable events of yesterday afternoon and it seems that Rabobank are being blamed (at least that’s what is being reported across the Dow Jones newswires). Cable fell over 100 pips in a matter of seconds and computer error is being blamed. A faulty order was logged in driving the market immediately lower. Rather than trying to execute an order in tranches as we’ve all been taught to do, an order for up to GBP3 billion was logged in to the system and of course the computer started hitting every bid in sight in a matter of seconds. That’s why it fell it so hard.
It just goes to show how much the market has changed in recent years.