Nanex Research

Nanex ~ 23-Jan-2013 ~ Paying for SCX

On January 23, 2013, in the stock of The L.S. Starrett Company (symbol SCX), almost 500,000 orders were placed and canceled over a 11 minute period of time. Prices were truly all over the map. The bulk of these manipulative orders appeared on NYSE and BATS.

A steady 500 quotes from NYSE (an order placed and canceled every 1/500th of a second) appears from NYSE (blue). Bid prices jumped from $11 to $11.15, and ask prices from $11.22 and up.

Not a single trade was executed during this 11 minute time period.

Either a HFT algo spun out of control, or destroying the integrity of the NBBO is now an approved activity. See also SEC statement on NBBO integrity and AAPL on the same morning.

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