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ES Force Ramped Above 150 DMA, At 10 Points Divergence To Risk Basket

Tyler Durden's picture


Today's ramp in stocks, courtesy of the ES, was purely an attempt to force technical short covering at the 150 DMA which was just retaken, as was the April 18 swing low, as well as 1.44 on the EURUSD. Yet on the other hand, theispersion between ES and the broader risk index is now at a 2 day wide, or about 10 S&P points. It seems that stocks are once again doing their headless chicken dance certain that either the Greek vote of confidence will pass, or Bernanke will announce QE3 tomorrow, or both, while everything else is reacting in a far more subdued. The two technicals heading into the close will be the push to close the spread on one hand, and the ongoing short covering from the 150 DMA on the other, as well as the second consecutive day in a row with a 150 pip move higher in the EURUSD on Chinese buying.


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Tue, 06/21/2011 - 11:48 | 1389110 mclee
mclee's picture

what does this mean?

Tue, 06/21/2011 - 11:50 | 1389115 qussl3
qussl3's picture

Means more taxes for you when the bankers blow it all to smithereens again.

WWould you like some KY with that?

Tue, 06/21/2011 - 12:15 | 1389227 mclee
mclee's picture

I am not US citizen, no tax from me

Tue, 06/21/2011 - 12:16 | 1389229 qussl3
qussl3's picture

Well just plain ole inflation for you then.

Tue, 06/21/2011 - 12:24 | 1389236 qussl3
qussl3's picture


It appears inflation persists in the digital realm too.

Tue, 06/21/2011 - 11:47 | 1389117 AbandonShip
AbandonShip's picture

sell the orange line and buy the white one

Tue, 06/21/2011 - 11:54 | 1389133 LowProfile
LowProfile's picture

How does someone w/o a BB terminal do this, and track it?

Tue, 06/21/2011 - 12:09 | 1389200 chartcruzer
chartcruzer's picture

Tyler's chart is awefully short term (day trading mode).   I could set up a comparison chart for you in the ETF DB if it's important.  send mail to See the set at,,,

slightly longer term you can see the relationship of other US risk markets to the SPX (the ES futures is a close approx.)[s164302276]&disp=P

bottom line is tech is getting it's ass kicked.

Tue, 06/21/2011 - 12:19 | 1389226 LowProfile
LowProfile's picture

Thanks, I suspected it was something you'd want to watch closely.

"retail trader" seems to have been an oxymoron for a very long time...

Tue, 06/21/2011 - 11:54 | 1389134 bigwavedave
bigwavedave's picture

or.... buy the orange line and buy double the white line.

Tue, 06/21/2011 - 11:53 | 1389146 qussl3
qussl3's picture

Or run the fuck away, cos when you need the liquidity to get out brother GS is doing the Lord's work.

Tue, 06/21/2011 - 16:15 | 1390053 Rick64
Rick64's picture


Tue, 06/21/2011 - 12:07 | 1389205 TempFlashback
TempFlashback's picture

It is just a relative value trade. The trade is looking for observed divergence (see headline and chart) to converge.

Tue, 06/21/2011 - 11:50 | 1389114 LawsofPhysics
LawsofPhysics's picture

Risk on, ahead of currency collapse?

Tue, 06/21/2011 - 11:58 | 1389153 PY-129-20
PY-129-20's picture

All or nothing. 18 red numbers and 18 black numbers and a single green zero. Place your bet, now!

Tue, 06/21/2011 - 12:31 | 1389281 John Law Lives
John Law Lives's picture

That is a European roulette wheel.


Tue, 06/21/2011 - 11:52 | 1389126 daneskold
daneskold's picture

JPMorgan gets hit with $3 Billion lawsuit form NCUA today.

No market reaction whatsoever.

Presumably $3 bill hit to JPM isn't material.

Tue, 06/21/2011 - 11:55 | 1389154 Prof Gulliver
Prof Gulliver's picture

Ben will just pay it anyway. Remember, we privatize gains, socialize losses.

Tue, 06/21/2011 - 11:58 | 1389128 buzzsaw99
buzzsaw99's picture

This time and the last time this chart was posted seems back asswards to me. both times the index appears to be outperforming the "risk basket" yet the text indicates the opposite.

Tue, 06/21/2011 - 13:47 | 1389529 Bwahaha WAGFDSMB
Bwahaha WAGFDSMB's picture

The ouperformance is transitory.

Tue, 06/21/2011 - 11:51 | 1389136 Village Smithy
Village Smithy's picture

It must suck to be Institutional right now with all these rats screwing with your time tested technicals. These guys may actually have to come in the mornings prepared to do some work rather than just sitting around ogling all the summer interns that they just hired.

Tue, 06/21/2011 - 11:57 | 1389145 baby_BLYTHE
baby_BLYTHE's picture

damn it feels good to be a gangster, eh

Tue, 06/21/2011 - 13:34 | 1389483 disabledvet
disabledvet's picture

it does.

Tue, 06/21/2011 - 12:18 | 1389237 Manzilla
Manzilla's picture

Ye of little faith. One of the key qualities of the institutional guys is that they can do both.

Tue, 06/21/2011 - 11:56 | 1389140 6 String
6 String's picture

I've been on the road, only noticing on CNN that the market goes up nearly everyday while they broadcast no other information on Gold, Silver, or anything else, including important and newsworthy stories. Seriously, you can't blame the busy sheeple for having no clue. How could they?

Anyway, amazed at the 10 year, pinned below 3% while the market rallies everyday. Amazing.

So, I haven't missed a beat in 6 days. All is as is....everything is purely WTF.

Ah...well, back to hitting the road. I can't follow the bullshit everything right now--it's too painful, especially as the R2K heads to 2000. Allocating capital when all is a big fucking farce ruled by deperate and despotic madmen that will do anything and more importantly can do anything they want is nearly impossible.


Tue, 06/21/2011 - 11:52 | 1389141 HelluvaEngineer
HelluvaEngineer's picture

Probably gonna step into a little VXX around 3PM.  Will add more if we get back up near 1340.  Anyone see any upside that's not already priced in?

Tue, 06/21/2011 - 11:56 | 1389160 qussl3
qussl3's picture

China AND Japan announcing they will be buying Greek crap.

Tue, 06/21/2011 - 12:02 | 1389181 HITMAN56
HITMAN56's picture

re-loaded VXX myself a bit ago

Tue, 06/21/2011 - 11:54 | 1389147 Boilermaker
Boilermaker's picture

This is fucking RIDICULOUS.

Oh, and the REITs are fucking soaring like fuck also.


Tue, 06/21/2011 - 12:03 | 1389174 Cdad
Cdad's picture

An ill-advised rally ahead of the Federal Reserve Bank's mandated "deflationary" wave called the end of QE2.  Seems to me that a lot of "special" algo's forgot the playbook for QE3.  

In the meatime, West Texas crude just took a curiously strong dump.  Let me guess...bullish?

Tue, 06/21/2011 - 12:09 | 1389198 qussl3
qussl3's picture

Exactly, if more expansion was really on the cards, Gold and Silver would be frontrun by now.

At minimum we get no expansion plus no tightening bias, the risk is a more hawish FED not more easing, more easing now would be open debasement, something even Banana Ben isnt insane enough to attempt - yet.

Tue, 06/21/2011 - 11:55 | 1389151 skepticCarl
skepticCarl's picture

This is a strong, wide spread bounce today, not only in stocks, but in precious metals and commodities.  Although I think that we have more down to go in the intermediate term (>3 pmonths), stocks and commodities probably will go higher in the short term (>2 weeks).

Tue, 06/21/2011 - 12:02 | 1389171 qussl3
qussl3's picture

The "investors" are pricing in heli-ben becoming banana ben tomorrow.

Tue, 06/21/2011 - 12:02 | 1389170 chartcruzer
chartcruzer's picture

this is just a fake out

long term still on sell - note the PSAR[s206018187]&disp=P

short term still on sell[s162488959]&disp=P

will use this to load up short - yum...  like shooting fish in a barrell (without QE3 that is)


Tue, 06/21/2011 - 12:02 | 1389182 HelluvaEngineer
HelluvaEngineer's picture

I still don't understand why Ben would need any justification for QE3.

Tue, 06/21/2011 - 13:17 | 1389428 Cdad
Cdad's picture

What he needs for QE3 is a stronger US that he can devalue it again without plunging into a disorderly dollar decline.  Higher dollar, lower equities, ta da...justification.

Tue, 06/21/2011 - 13:14 | 1389415 skepticCarl
skepticCarl's picture

Chartcruzer, your charts are terrific, and I gave them the top vote.

But, could you comment on why they show a short term sell?  It looks to me like a short term oversold condition, very ripe for a short term bounce. TIA

Tue, 06/21/2011 - 12:03 | 1389176 thetrader
thetrader's picture

nice pop past 2 days, just like we wrote, after having reached nice support levels, market has been nice nice, if u followed Risk On on

Tue, 06/21/2011 - 12:05 | 1389178 partimer1
partimer1's picture

Oversold bounce. prepare for big Ben tomorrow. we either go down really hard tomorrow and next day, or linger to up for another week, then go down hard.  

Tue, 06/21/2011 - 12:05 | 1389179 stirners_ghost
stirners_ghost's picture

YTD chart of the indices needs a right shoulder...

Tue, 06/21/2011 - 12:06 | 1389180 SwissNico
SwissNico's picture

can anyone give the bloomberg details of this CIX so we can recreate it?

or can anyone share it with me?

Tue, 06/21/2011 - 13:11 | 1389417 jesus_quintana
jesus_quintana's picture

Might be way off beam here as I've never seen the calc given - but indexed to last night's SPX (not ES) close, I'm guessing something like:

((15.06239 * AUDJPY Curncy) + (893.7081 * EURUSD Curncy) + (432.1704 * USGG10YR Index) + (948.5494 * .T21030 U Index) + (13.70748 * CL1 Comdty) + (0.830293 * GOLDS Comdty)) / 6

You need to create the butterfly CIX (.T21030 above) first btw: 2 * USGG10YR Index - USGG2YR Index - USGG30YR Index

I'm basically just multiplying the closes of the constituents to the SPX close and taking the average, someone out there might have a better answer?

Tue, 06/21/2011 - 12:03 | 1389191 dracos_ghost
dracos_ghost's picture

End of quarter coming up. Need to get back to 0% (~ 1330 on SPX). Fund managers need to keep the natives soothed with their quarterly reports of happy,happy,happy.

Tue, 06/21/2011 - 12:04 | 1389194 sbenard
sbenard's picture

Oh goody! It's another Pollyanna Party!

Tue, 06/21/2011 - 12:06 | 1389201 sbenard
sbenard's picture

QEInfinity, anyone? Sorry, we're calling it "rate caps" now!

Tue, 06/21/2011 - 12:07 | 1389204 thetrader
thetrader's picture

this from earlier

Hearing large US Bank buying mini S&P here, big buy order GS buying
GS now on the offer, from NY desk

Tue, 06/21/2011 - 12:26 | 1389248 qussl3
qussl3's picture

Squeez'em and then dump'em.

Tue, 06/21/2011 - 12:15 | 1389215 Cdad
Cdad's picture

as well as the second consecutive day in a row with a 150 pip move higher in the EURUSD on Chinese buying.

I would suggest that if this is true, then the Euro should be sold aggressively.  China is the worst capital allocator on the none.

Tue, 06/21/2011 - 12:32 | 1389270 Cdad
Cdad's picture

I challenge anyone to put up a one day chart of the FXE [ETF for long Euro] and then fill up the chart with typical technical indicators [DeMarks, MACD, RSI, etc]...and then suggest a going forward long thesis for that ETF into the close.

Seriously, if you can make sense of the entirely FUBAR and contrary technical signals coming out of that thing, I'd really like to hear your day trading thesis for buying it.

Mine is...and after drinking a nice cup of mushroom tea...crocodile algo.

[The desperation in this market is so clear in so many ways today.]

Tue, 06/21/2011 - 12:42 | 1389311 qussl3
qussl3's picture

The only reason they need to pump it up is "news" of Chinese and Japs on the bid to "support" Greece.

Tue, 06/21/2011 - 12:22 | 1389245 eurusdog
eurusdog's picture

Will it be wrong to laugh when this move is completely reversed tomorrow after the Greeks vote down Papaandthenose?

Tue, 06/21/2011 - 12:27 | 1389264 qussl3
qussl3's picture

It's likely to be reversed even if the vote passes, this vote doesnt have any money behind it lol.


Tue, 06/21/2011 - 12:29 | 1389273 TradingJoe
TradingJoe's picture

The Bancheros can amass as much as they want...toilet paper...!

What they have one will see it, until its too late, that is!

Tue, 06/21/2011 - 12:50 | 1389329 Bam_Man
Bam_Man's picture

The bond market is calling "bullshit" to all of this.

Long bond yield is not even budging.

Tue, 06/21/2011 - 12:48 | 1389333 agrotera
agrotera's picture jove (and as usual)  you know it TD!!!!

Tue, 06/21/2011 - 12:53 | 1389343 gianakt
gianakt's picture

Think the FOMC starts targeting for a higher dollar. As the low dollar is chocking off economic activity worldwide by causing commodity prices to rise. Lets see what the FOMC does tommorrow!!!

Tue, 06/21/2011 - 13:15 | 1389411 jesus_quintana
jesus_quintana's picture

Edit: double post

Tue, 06/21/2011 - 14:22 | 1389646 sheep92
sheep92's picture

If the markets can rally wih crude going down its a whole new ballgame.  Buy all the stuff that has been crushed the last 6 months as all the cash flowed into commodities (oil).  Cars, steel, gold stocks (not physical) airlines and sox.

One possible bullish catalyst is oil.  The last time the saudi's got pissed they drove the price of crude to $10.  While they wont get it there this time if they manage 75 equities are going to rip.  If I was short equities I would be praying for the good health of ghadaffi (sp?) if libya's 1.6 million barrels a day comes ack on line it will crush oil.   obamas campaign knows that 2.89 at the pump is gonna get him another term.

$4.50 and he'll be packing his bags

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