What Is a Stock Market Circuit Breaker and When Does It Trigger?
Direct answer
US circuit breaker levels
A circuit breaker is an automatic pause in trading after a very large fall. In the US, market-wide circuit breakers are based on the S&P 500: a 7% drop from the previous close (Level 1) or 13% (Level 2) halts all stock trading for 15 minutes if it happens before 3:25 p.m. Eastern time, and a 20% drop (Level 3) stops trading for the rest of the day. Individual stocks have separate limit up-limit down pauses.
- Level 1: S&P 500 down 7% from prior close: 15-minute halt (before 3:25 p.m. ET)
- Level 2: down 13%: another 15-minute halt (before 3:25 p.m. ET)
- Level 3: down 20%: trading stops for the rest of the day
- Single stocks: limit up-limit down bands pause trading for 5 minutes
When a market falls so fast that trading stops, many people assume something has broken. In fact, the pause is a designed safety feature, and the rules are public.
What people on X are asking
Circuit breakers came up repeatedly in 2026 because of Asian markets. In November one post reported that South Korea's KOSPI triggered a circuit breaker after an 8% plunge, forcing a 20-minute halt, and a July post described another automatic halt in Korea. In September a user asked what a circuit breaker at the Istanbul exchange means and what it implies. The rules differ by country; below are the US rules and how to think about any halt.
The fact-checked answer
Market-wide circuit breakers (US). Since 2013 US exchanges have used three thresholds measured against the S&P 500's previous closing value, as described by Investor.gov and the NYSE:
US market-wide circuit breaker levels
Each level can trigger only once per day. Halts apply across US stock exchanges and options markets. Thresholds are recalculated daily from the previous close. Tap a column header to sort.
| Level 1 | 7% | Trading halts for 15 minutes | No halt (trading continues) |
| Level 2 | 13% | Trading halts for 15 minutes | No halt (trading continues) |
| Level 3 | 20% | Trading stops for the rest of the day | Trading stops for the rest of the day |
Real triggers. The Level 1 breaker fired four times in March 2020 (March 9, 12, 16 and 18) during the pandemic sell-off. Before that, a market-wide halt under older rules occurred on October 27, 1997. Level 2 and Level 3 have not been triggered under the current system.
Single stocks: limit up-limit down (LULD). Each listed stock has a price band around its recent average price. If the stock trades outside the band and does not return within 15 seconds, trading pauses for five minutes. The bands are wider for cheaper and less-traded stocks and are doubled near the open and close. This is why you may see "halted" on a single stock during a news spike even when the overall market is calm. Our page on why a stock was halted covers news halts too.
Futures have their own limits. Index futures on CME have price limits overnight and coordinated halts during the stock-market day. See how index futures trade overnight.
Other countries. Korea's exchange uses 8%, 15% and 20% thresholds with 20-minute halts, according to reports of the 2026 events; Turkey's Borsa Istanbul has its own index-level rules. Always check the specific exchange's rulebook.
UXS decision diagram
Trading just halted: what does it mean for my order?
Text version of the diagram
- Is it a market-wide halt (all stocks stopped)? If yes: Wait: orders queue and trading reopens after 15 minutes, or next day at Level 3
- Is it one stock with a limit up-limit down pause? If yes: The pause usually lasts 5 minutes; price can reopen far from the last trade
- Is it a news or regulatory halt on one stock? If yes: It can last hours or days; check the exchange's halt list
- Do you have a market order queued? If yes: Consider cancelling: it may fill at the reopening price, which can be far away
- Otherwise: Use limit orders around reopenings and do not chase the first print
Diagram drawn by UXS. A simplified decision aid for education, not a recommendation.
Why halts exist. After the crash of October 19, 1987, when the Dow fell 22.6% in one day, regulators introduced circuit breakers to give investors time to absorb information and to prevent a disorderly spiral. The May 6, 2010 "flash crash" led to the LULD system.
Heavy volume on triple witching days is normal and is a different thing from a circuit-breaker halt.
Single stocks have their own pauses; see why trading in one stock gets halted and when it resumes.
Decision helper
| Halt type | Trigger | Typical length | What to do |
|---|---|---|---|
| Market-wide Level 1 or 2 | S&P 500 −7% or −13% | 15 minutes | Check open orders; avoid market orders at reopen |
| Market-wide Level 3 | S&P 500 −20% | Rest of day | Plan for the next session |
| LULD pause | Single stock outside its band | 5 minutes (can repeat) | Use limits; expect a gap |
| News pending / regulatory | Exchange or SEC decision | Minutes to weeks | Read the official notice |
Checklist
- Learn the difference between a pause, a halt and a suspension.
- Know that stop orders become market orders and can fill badly at reopen; see market vs limit orders.
- Keep position sizes small enough to survive a gap.
- Watch the VIX during violent days; see what a VIX spike means.
- For foreign markets, look up that exchange's thresholds.
Common mistakes
- Thinking a halt means the market will crash further. It often slows panic selling.
- Leaving market orders open across a halt.
- Assuming stop-losses protect you during a gap.
- Confusing a single-stock LULD pause with a market-wide halt.
FAQ
What is a circuit breaker in the stock market?
An automatic trading halt triggered by a large price fall, designed to slow panic and give time for information to spread.
What percentage triggers a circuit breaker?
In the US: S&P 500 declines of 7%, 13% and 20% from the prior close.
How long do circuit breaker halts last?
15 minutes for Levels 1 and 2 if triggered before 3:25 p.m. ET; Level 3 stops trading for the rest of the day.
When did circuit breakers last trigger in the US?
Level 1 triggered four times in March 2020.
Do circuit breakers apply to crypto?
No. Crypto exchanges trade 24/7 and do not have market-wide halts, although individual platforms may pause trading.
Can a halt be triggered by a rise?
Market-wide breakers apply to falls only. LULD bands apply in both directions for single stocks.
Sources
- SEC Investor.gov: Stock market circuit breakers
- NYSE: Market-wide circuit breakers FAQ
- LULD plan: Limit up-limit down
Facts checked November 10, 2026. X posts are cited as evidence of the question, not of the answer.