Trading shut-down takes place when the Dow Jones Index falls below a specified level, trading is ended for the day at the index mentioned to avoid worse crashes. This is indeed followed due to past experiences and crashes.

The specific number of points which can be taken to be a reason good enough for the market shut-down is updated twice a year, one in January and the other in June, this is arrived at by looking in to the average value of the Dow over the past month.

A decline of nearly 20% in the Dow’s value ends on that particular trading day.