Notice No. 00-421
December 12, 2000

MEMORANDUM

TO:  ALL NYMEX AND COMEX MEMBERS

FROM:  Neal L. Wolkoff
  Executive Vice President

DATE:  December 12, 2000

RE:  Reminder of Price Fluctuation Limits Applicable to Trading on NYMEX 
ACCESS&#61495;

The purpose of this Notice is to remind Members and Member Firms that an 
Executive Committee Resolution that was ratified by the Board of Directors 
and that concerns Exchange price fluctuation limit rules as those rules apply 
to trading on NYMEX ACCESS&#61495; (Resolution), remains in effect and will 
continue until February 1, 2001, unless Members are notified otherwise by the 
Exchange.

As background, on October 6, 2000, the Exchange issued a Notice to Members 
(#347), advising Members and Member Firms that the CFTC had approved this 
Resolution.  The Resolution, which became effective with the commencement of 
the NYMEX ACCESS&#61495; session on Sunday, October 8, 2000, has amended on a 
temporary basis a number of Exchange price fluctuation limit rules as those 
rules apply to trading on NYMEX ACCESS&#61495;. The Resolution is included 
below.

The Resolution was issued so as to ensure the successful reimplementation of 
the new implied order functionality on NYMEX ACCESS&#61495;.  By 
significantly expanding the price fluctuation limits applicable to trading 
activity occurring on NYMEX ACCESS&#61495;, the Resolution reduces the 
possibility that a price limit would be triggered by the implied 
functionality.

The Resolution amends, on a temporary basis, Exchange price fluctuation limit 
rules - but only with respect to market activity occurring on NYMEX 
ACCESS&#61495;.

Thus, the new price limits that went into effect last week for Natural Gas 
are further expanded as provided by the terms of the Resolution.

The Resolution amends the Exchange,s price fluctuation limit rules with 
regard to trading on NYMEX ACCESS&#61495; in four ways:

(1) The initial and subsequent price fluctuation limits (for each Exchange 
futures contract that has such limits) are expanded to 200% of the initial 
and subsequent price fluctuation limits applicable to the first two contract 
months for energy contracts, or to the first contract month with limits in 
effect for metals contracts, of that futures contract under the applicable 
rule.

(2) This expanded limit (e.g., 200% of the limits for the front two months 
for energy contracts) is applicable to all contract months for that futures 
contract.

(3) In the event that an expanded price limit was touched by a bid or offer, 
trading on NYMEX ACCESS&#61495; generally would be halted immediately, rather 
than requiring the market to trade at that price for five minutes. During the 
last 90 minutes of a NYMEX ACCESS&#61495; session, the market would be halted 
only far as long as it takes for the system to incorporate expanded price 
limits.

(4) As a clarification, the Resolution suspends use of certain &haircuts8 
narrowing price limits based on notional settlement prices.  Specifically, 
NYMEX Rule 6.56 (Settlement Prices and Price Fluctuation Limits for NYMEX 
ACCESS&#61495;) establishes the use of notional settlement prices as the base 
point for price limits (until the actual settlement prices from the RTH 
session can be input into the system.)  NYMEX ACCESS&#61495; will continue to 
use such notional settlement prices under the Resolution.  However, Rule 6.56 
reduces applicable price limits by certain specified percentages during the 
period when notional settlement prices are used as the base point for 
establishing limits. Such &haircuts8 are not being used under the Resolution; 
the Exchange will resume use of such haircuts following the expiration of the 
Resolution.

Finally, the Resolution also clarifies one aspect of existing Exchange 
practice.  In the event that a contract trading on NYMEX ACCESS&#61495; 
traded for five minutes at a price fluctuation limit applicable to Regular 
Trading Hours (RTH) trading, then the RTH session would open with expanded 
price fluctuation limits as provided under the applicable rule.  This 
practice will continue to be followed during the period when the Resolution 
is in effect, even though there had been no temporary cessation of trading 
during the NYMEX ACCESS&#61495; trading session because the market had not 
hit the expanded limits applicable only to NYMEX ACCESS&#61495;.


*  * * *
As noted, these temporary amendments to the Exchange,s price limits shall 
expire on February 1, 2001, unless Members are notified otherwise by the 
Exchange.
*  * * *

If you have any questions, please contact Stu Homler, Director, NYMEX 
ACCESS&#61495; Operations, NYMEX ACCESS&#61495; Department, at (212) 
299-2754, Matt Morano, NYMEX ACCESS&#61495; Department, at (212) 299-2679, or 
Brian Regan, Senior Associate General Counsel, at (212) 299-2207.

APPROVED RESOLUTION OF THE EXECUTIVE COMMITTEE
OF THE BOARD OF DIRECTORS REGARDING PRICE
FLUCTUATION LIMITS FOR EXCHANGE CONTRACTS

The Executive Committee of the Board of Directors hereby

Resolves that, until further notice, the price fluctuation limit rules for 
each futures contract that is listed for trading on NYMEX ACCESSc and that 
has such applicable rules shall continue in effect except as amended below 
with regard to market activity occurring on NYMEX ACCESSc:

The initial and subsequent price fluctuation limits (for each Exchange 
futures contract that has such limits) shall be expanded to 200% of the 
initial and subsequent price fluctuation limits applicable to the first two 
contract months of that futures contract that have price limits under the 
applicable rule.

This expanded limit (200% of the limits for the first two months with limits) 
shall be applicable to all contract months for that futures contract.

In the event that such a price fluctuation limit is reached by a bona fide 
bid at the high price fluctuation limit or a bona fide offer at the low price 
fluctuation limit, trading on NYMEX ACCESSc shall be halted immediately 
except as directed otherwise by the President or the President,s designee.  
Following resumption of trading, the price limits in effect shall be 200% of 
the limits applicable to RTH trading.  In the event that a limit is touched 
during the last 90 minutes of a NYMEX ACCESSc session, the market shall be 
halted briefly, and price limits shall be expanded thereafter

In addition, in the event that a contract trading on NYMEX ACCESSc traded for 
five minutes during the NYMEX ACCESS&#61495; session at a price fluctuation 
limit applicable to the Regular Trading Hours session, then the RTH session 
shall open with expanded price fluctuation limits as provided under the 
applicable rule, even though no temporary cessation of trading occurred 
during the NYMEX ACCESSc trading session.




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