12/07/2000
The amended rules, which are attached, will take effect for the opening of the open outcry tading session at 9:30 AM tomorrow.
The Exchange announced this morning that the board last night voted to amend the procedures so the new natural gas limit will be $1.000 per million British thermal unit and if any contract month is traded, bid, or offered at the limit for five minutes, the market is halted for 15 minutes. When trading resumes, expanded limits are in place that allow the price to fluctuate by $2.000 in either direction of the previous day's settlement price.
Currently, the market is halted for one hour if the price in one of the first two months is traded at $.750 for five minutes. When the market reopens, those limits are extended to all months, but are moved to surround the previous limit in place in the direction of the move.
Under the amended rules, if a halt occurs during the last two days of trading in a contract, when the market reopens, there are no price limits placed on either of the first two nearby contract months.
NATURAL GAS: APPROVED AMENDMENTS TO PRICE FLUCTUATION LIMIT RULES
The rules below reflect the provisions that are being implemented. A copy of the rules reflecting the changes made from the prior version of these rules can be obtained from the Exchange’s Legal Department.
Rule 220.08. PRICES AND MINIMUM FLUCTUATION SIZE
(A) Prices shall be quoted in dollars and cents per million British thermal units (MMBtu). The minimum price fluctuation shall be $.001 per MMBtu.
Rule 220.08A. SPECIAL PRICE FLUCTUATION LIMITS FOR NATURAL GAS FUTURES
(A) Initial Price Fluctuation Limits for All Contract Months. At the commencement of each trading day, there shall be price fluctuation limits in effect for each contract month of this futures contract of $1.00 per MMBtu above or below the previous day’s settlement price for such contract month.
(B)(1) Triggering Event and Temporary Trading Halt. If a market for any contract month is traded or, is bid in the case of upward price moves or is offered in the case of downward price moves, for five (5) minutes consecutively at the upper or lower price limit, as applicable, then a Triggering Event will be deemed to have occurred.
(2) Except as otherwise provided in this rule, as a result of such Triggering Event, the market will be given notice immediately that in two (2) minutes, there will be a fifteen (15) minute temporary trading halt in all contract months of that futures contract and the associated option contract ("Temporary Trading Halt"). The market will remain open during this two-minute notice period, and the commencement of the Temporary Trading Halt shall not be affected by market activity occurring during this notice period.
(3) Expansion of Limits Following Temporary Trading Halt. Following the end of the 15-minute Temporary Trading Halt, the market shall reopen in all contract months of this futures contract. When trading resumes, price fluctuation limits for each contract month, except as otherwise provided in this rule, shall be expanded to $2.00 per MMBtu above and below the previous day’s settlement price for such contract month; provided that if such Temporary Trading Halt occurs on either of the last two days of trading in the current delivery month, when trading resumes, there shall be no price fluctuation limits in effect for the remainder of the trading day both for the current delivery month and for the next nearest contract month to delivery.
(4) Following resumption of trading after a Temporary Trading Halt, there shall be no additional trading halts and no further expansion of price limits for the remainder of the trading day.
(C) Duration of Session Following Temporary Trading Halt. When trading resumes after a Temporary Trading Halt, trading generally shall continue until the regularly scheduled closing time subject to the following exceptions:
1) if, at the start of the 15-minute Temporary Trading Halt, there is less than 15 minutes before the close, then, when trading resumes after the Temporary Trading Halt, the trading session shall be expanded as necessary to provide for fifteen (15) minutes of trading following the resumption of trading, and the closing period shall be the final two minutes of trading of this 15-minute period of trading;
2) provided however that if the five-minute Triggering Event is completed during the closing period (on any day other than the last day of trading in the current delivery month), there shall be no Temporary Trading Halt for any contract month and no expansion of price limits for any contract month; and 3) provided further that if the five-minute Triggering Event is completed during the closing period on the last day of trading in the current delivery month, following the 15-minute Temporary Trading Halt, trading shall resume for thirty (30) minutes for all contract months. In such circumstances, the closing range for the current delivery month shall include both the period from the start of the closing range to the start of the Temporary Trading Halt as well as the 30-minutes of trading following resumption of trading.
(D) Application of Price Fluctuation Limits to NYMEX ACCESS® The limits described in this rule shall apply to trading on NYMEX ACCESS®, except as provided by NYMEX Rule 6.56 and except that:
(1) if the five-minute Triggering Event is completed during the last ninety minutes of a NYMEX ACCESS® trading session, there shall be no Temporary Trading Halt and no expansion of price limits during the remainder of such NYMEX ACCESS® trading session, and
(2) there shall be no Temporary Trading Halt during a NYMEX ACCESS® trading session if, in the opinion of the President of the Exchange or his designee, either the Triggering Event was not reflective of otherwise prevailing market conditions or a Temporary Trading Halt is unwarranted.