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Traders from all around the World are in shock

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A 6% drop in GBP/USD that caught investors and market makers by surprise failing after traders targeted downside option barriers, say three Asia-based FX dealers.
NOTE: Traders typically place their nearest orders within 100 ticks of spot, which was at roughly 1.26 before today’s plunge.
The drop accelerated as liquidity disappeared, and dealers failed to load bids into their trading platforms, say traders.
One trader says his FX pricing aggregator of eight contributors blacked out for 30 seconds amid an absence of bids.
Multiple large option barriers in the over-the-counter market were triggered, including 1.25 and 1.20, say traders.
Traders say they missed buy orders much lower down and had to scramble to cover inherited short positions, thus contributing to the roughly 500-point rally.
GBP/USD now down 1.7% to 1.2403 versus range 1.14-1.2623

Bloomberg


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