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Low Volume Meltup Resumes

Tyler Durden's picture





 

After last week we actually saw some volume participation for the first time in 2011, today the no-volume meltup has resumed. The chart below shows the relative to average volume in the ES. Which ironically shows the Catch 22 the banks find themselves in: the higher they run up the market, the less participation there is, the less trading volume, the lower commissions, and the lower the profits from the traditionally biggest contributors to bank P&L over the past 2 years: flow and prop trading (as confirmed recently by Goldman, Morgan Stanley, JPM, Jefferies and everyone else). Which simply means that banks will have to increasingly rely on the Treasury curve trade (and of course, fudged accounting) to make their bottom line. This would work if consumers had actually stopped deleveraging. Which they haven't. Meaning simply that banks will need to make all their trading profits on market distributions and other crashes that see volume spike. But that as we now know, is contrary to the Fed's third mandate. A curious bind indeed.

h/t Andrew Yorks

 


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Mon, 01/24/2011 - 13:21 | Link to Comment thepigman
thepigman's picture

Who would participate in this mess?

For the bernanke to do this, we must

be in much more trouble than we

imagine.

http://www.ritholtz.com/blog/2011/01/how-much-has-the-fed-distorted-the-...

Mon, 01/24/2011 - 13:37 | Link to Comment SheepDog-One
SheepDog-One's picture

MUCH bigger trouble than most imagine.

Mon, 01/24/2011 - 14:03 | Link to Comment Sudden Debt
Sudden Debt's picture

BAC is going down. That could trigger another gray swan :)

 

MY PUTS ARE A ROCKING!!! :)

Mon, 01/24/2011 - 14:12 | Link to Comment thepigman
thepigman's picture

That pos should be nationalized and

its shareholder and bondholders

wiped.

Mon, 01/24/2011 - 13:26 | Link to Comment ak_khanna
ak_khanna's picture

Mon, 01/24/2011 - 13:23 | Link to Comment ak_khanna
ak_khanna's picture

The markets will fall only when the banksters have eliminated all the short positions and only they themselves have positioned themselves to profit when the market falls

OR

When an unexpected world event catches the banksters with their pants down and the softwares they use to rig the markets go berserk beyond their control.
http://www.marketoracle.co.uk/Article24581.html

Mon, 01/24/2011 - 14:05 | Link to Comment Sudden Debt
Sudden Debt's picture

I love it when "they" talk about "them"

I always makes it so credible :)

 

THEY DON'T NEED TO PLAN IT!! THEY JUST HAVE TO LOOK TO SOMETHING BEFORE IT BLOWS

Mon, 01/24/2011 - 13:25 | Link to Comment ak_khanna
ak_khanna's picture

.

Mon, 01/24/2011 - 13:26 | Link to Comment plocequ1
plocequ1's picture

Who needs volume? Its alll digital

Mon, 01/24/2011 - 14:06 | Link to Comment Sudden Debt
Sudden Debt's picture

Watching porn is also all digital

AND STILL I LIKE IT :)

Mon, 01/24/2011 - 13:30 | Link to Comment SheepDog-One
SheepDog-One's picture

Well thats the rub....sure go melt up the empty no-bid markets to placate the sheeple on their drive home from the unemployment office, but thats ALL you get as it doesnt actually do anyone a damn bit of good.

Go ahead and do the same yourself...put an ad in the newspaper to sell your 85 Benz which needs a ring job for $100,000...does it make you feel good to be so 'rich'? Whatever.

Mon, 01/24/2011 - 15:18 | Link to Comment ZeroPower
ZeroPower's picture

No bid markets? Plenty of bids today despite weak overseas action. Not that it matters, but for the plebs, maybe Dow 12k.

 

BTFD. Rinse, repeat.

No point in going against it. 

Mon, 01/24/2011 - 13:27 | Link to Comment Bigger Dickus
Bigger Dickus's picture

Watching the market go up since I closed my trading account and got into physical PMs a year ago has been a nerve wracking experience. Fuck fuck fuck

Mon, 01/24/2011 - 13:31 | Link to Comment thepigman
thepigman's picture

Robo and Wanker can have it. I ain't buying something

jacked by 40% by the bernanke. I

won't even rent it.

Mon, 01/24/2011 - 13:41 | Link to Comment topcallingtroll
topcallingtroll's picture

But you would still buy silver jacked up over 40 percent?

Mon, 01/24/2011 - 13:44 | Link to Comment SheepDog-One
SheepDog-One's picture

'Silver jacked up 40%'? Ignorant. Its not even near its historical fair value of 14:1 to gold. You big dummy.

Mon, 01/24/2011 - 13:51 | Link to Comment goldmiddelfinger
goldmiddelfinger's picture

Wont see 14/1 in your lifetime.

Mon, 01/24/2011 - 13:53 | Link to Comment SheepDog-One
SheepDog-One's picture

Dream on.

Mon, 01/24/2011 - 14:04 | Link to Comment Cash_is_Trash
Cash_is_Trash's picture

Argentum going to $50

Mon, 01/24/2011 - 13:35 | Link to Comment SheepDog-One
SheepDog-One's picture

Personally I think we get a sudden down draft, theres NOTHING going on in markets and they need to shake things up even if it means getting everyone short suddenly for a quick scalping. With even the bears now capitulating and figuring you cant fight the FED, may as well go all in long after all 10% is the biggest downside risk possible, yea they can have it Im out for good. 

Mon, 01/24/2011 - 13:51 | Link to Comment Cdad
Cdad's picture

Dog,

I hope you are right about the sudden drop.  However, I think folks got to understand that selling the market is not a matter of calling the minute the index finally turns...but rather finding stocks priced for stupid, or dot com, or even better...stocks priced for D. Tepper...and selling those.

Check the burritos.  Check the cloud.  Soon to join, the bank in charge of manipulating silver and drug companies that suck...Etc.  The ETFs can levitate the index all it wants.  I see a lot of the underlying issues deteriorating hard...and for weeks now.

Let's go guys...get your Whack-a-Mole game up and running already.

Mon, 01/24/2011 - 13:57 | Link to Comment buzzsaw99
buzzsaw99's picture

The response to a "sudden downdraft" the last time was congressional hearings. There will be no downdraft, sudden or otherwise.

Mon, 01/24/2011 - 15:33 | Link to Comment SheepDog-One
SheepDog-One's picture

Right, there used to be problems but they got all those fixed now. This time its different. Sure the peaks of all other bubbles had the same uephoric certainty that this time the bubble would never pop, but Im sure this time theyre right and their intention is to now forever prop stocks higher. Yea.

Mon, 01/24/2011 - 13:31 | Link to Comment TruthInSunshine
TruthInSunshine's picture

It's all good.

The Bernank and his supporters (some of whom have been pitching his 'merits' on no less than ZH, lately) arrogantly scoff at suggestions that the Chairman doesn't know exactly what he's doing, doesn't have 100% confidence in his plans and isn't 100% certain that all of his objectives can and will be achieved without things taking a turn for the very worst.

In related news, men throughout history have suggested they have devices to stop hurricanes in their tracks.

Mon, 01/24/2011 - 13:37 | Link to Comment topcallingtroll
topcallingtroll's picture

I am not a bernanke supporter but he has played a bad hand very well so far. China had a good hand but has played relatively.unsophisticatedly recently.

Mon, 01/24/2011 - 13:46 | Link to Comment SheepDog-One
SheepDog-One's picture

WELL pretty easy to play a bad hand when YOU are the house, make up the rules as you go, and have a gun to all other players heads!

Mon, 01/24/2011 - 13:35 | Link to Comment topcallingtroll
topcallingtroll's picture

Intermediate top guys and a deflation scare coming our way. I am the top.calling troll and you must worship me. Dollar bottoming temporarily and may just trade in a channel.for a few years. The least ugly.girl out there with enough liquidity for the big boys is still the pimply faced dollar.

Mon, 01/24/2011 - 13:35 | Link to Comment The Axe
The Axe's picture

It is now official beyond belief, for today, higher tomorrow, then the next. The market is broken. Clue Robo to put charts of Solar companies, and hot girls in enjoying the sun.

Mon, 01/24/2011 - 13:38 | Link to Comment topcallingtroll
topcallingtroll's picture

Yeah. Boobies!

Mon, 01/24/2011 - 13:43 | Link to Comment plocequ1
plocequ1's picture

Dont worry, ZH will put up some more charts and make it all better. Please try to use more Red and green colors. I love Christmas.

Mon, 01/24/2011 - 13:40 | Link to Comment TradingJoe
TradingJoe's picture

This should be worth a few Put Contracts, or not?!?!

Mon, 01/24/2011 - 13:41 | Link to Comment blackbox
blackbox's picture

shrinking volume momo trades are sooooo 2010.

 

Ben wants 2011 to be the year of novomo!

Mon, 01/24/2011 - 13:45 | Link to Comment cougar_w
cougar_w's picture

Paint, meet corner.

Mon, 01/24/2011 - 13:49 | Link to Comment SheepDog-One
SheepDog-One's picture

Yes but we're told its a particularly sweet corner to be in, and that they can stay in it forever! Somehow I dont think so.

Mon, 01/24/2011 - 13:56 | Link to Comment cougar_w
cougar_w's picture

Well you see that all depends on which part of the building is on fire, and how close your corner is to the exit out.

Mon, 01/24/2011 - 14:08 | Link to Comment Sudden Debt
Sudden Debt's picture

Plane, meet builing

 

you know what....

 

LET'S DOUBLE DATE!!!

Mon, 01/24/2011 - 13:45 | Link to Comment FoieGras
FoieGras's picture

We had good volume in the Nasdaq short squeeze of 1999. Good volume doesn't mean you can trust a move and low volume doesn't mean a move can be recklessly faded.

Mon, 01/24/2011 - 13:46 | Link to Comment lieutenantjohnchard
lieutenantjohnchard's picture

the stockmarket represents little in the grand scheme of things in that the usa doesn't really have an economy anymore. sure, we have random transactions between businesses and consumers  - hate that word - dehumanizing. but for those with their eyes open it ought to be obvious. look at the number of pawn shows that are hits on the television. we basically have a garage sale economy with huge transfer payments to keep the folks off the streets and out of the pantry of today's rich.

Mon, 01/24/2011 - 13:49 | Link to Comment thepigman
thepigman's picture

If the bernank owns all this equity

and has stuck it in the Caribbean

somewhere, somebody oughtta let

him know he's been overpaying since

SPX 800.

Mon, 01/24/2011 - 13:51 | Link to Comment SheepDog-One
SheepDog-One's picture

And paying more every day. Is that an endgame unto itself? No, whatever is next no one can see yet but its big and ugly. Even uglier than Napolitano.

Mon, 01/24/2011 - 13:59 | Link to Comment thepigman
thepigman's picture

Ya gotta laugh at him though. This

stuff won't be saleable at these prices

again for a generation.

Mon, 01/24/2011 - 14:02 | Link to Comment thepigman
thepigman's picture

Cramer must be a key adviser. lol

Mon, 01/24/2011 - 15:34 | Link to Comment SheepDog-One
SheepDog-One's picture

Who do they plan on selling it all to? They can forget about me, no sale.

Mon, 01/24/2011 - 14:01 | Link to Comment cougar_w
cougar_w's picture

Nothing wrong here that a bit of creative accounting couldn't fix. All that's required is that all the other playerz agree to play by the same whacked out rules indefinitely and nobody notice everyone else's hair is on fire and nobody bolt for the door first with their part of the loot. As you can see nothing can possibly go wrong.

Mon, 01/24/2011 - 13:58 | Link to Comment buzzsaw99
buzzsaw99's picture

Volume down, dollar down, rally on.

Mon, 01/24/2011 - 14:01 | Link to Comment john milton
john milton's picture

dow 12.000 party soon..ben must feel happy

Mon, 01/24/2011 - 14:26 | Link to Comment onlymyopinion
onlymyopinion's picture

That's just a pre-party warm up till the biggie later this year.  You won't wanna be caught not in the market for the Dow 13k shindig.  All the kids will be there.  Be sure to keep your Nov/Dec calenders clear

Mon, 01/24/2011 - 15:39 | Link to Comment SheepDog-One
SheepDog-One's picture

AHH HA HA yea 2011 is already PRICED-IN! 13,000 is a given, 14,000 is a done deal, RUN dont walk to get yours now while its all so CHEAP for the really big end of the year run! LMAO!

Mon, 01/24/2011 - 15:45 | Link to Comment onlymyopinion
onlymyopinion's picture

Not expecting 14k till 2012.  Check out the little diddy below and, if your short, what your up against this year.  The exclaimation point is the January Effect confirmation.

 

The third year of a presidency is historically a favorable one for the markets –data indicates that on average, the S&P 500 gained 14.12%, and average gains were 17.7% under a Democrat party leader.

The last time the market was down in a 3rd year was in 1939. That's 19 straight 3rd years in a row of being up

 

 

Mon, 01/24/2011 - 14:06 | Link to Comment OMG
OMG's picture

Let's see the Bernak & his cronies (the FED) create that bad hand then have to deal with the bad hand they created, let me think about this a second.......

Mon, 01/24/2011 - 14:07 | Link to Comment Ancona
Ancona's picture

Whe QE2 ends, and all the bids are pulled, the banksters wil come crying to Ben and Timmah for more QE, 'cause that's what it takes to have an active market these days, someone elses money.

Mon, 01/24/2011 - 15:01 | Link to Comment plocequ1
plocequ1's picture

Ehhhhh, No

Mon, 01/24/2011 - 14:09 | Link to Comment Cdad
Cdad's picture

What?  I just heard the Slow Money crew on the Blow Horn [CNBC] talk down two of my short positions...as shorts folks should consider.

And then I heard Sue whatever say, "You heard it here first."  What!  I am outraged!  I have been telling you guys this stuff for weeks.

Tyler...we got Blow Horn hanger ON'rs!

Mon, 01/24/2011 - 15:41 | Link to Comment Johnny Lawrence
Johnny Lawrence's picture

dup post

 

 

Mon, 01/24/2011 - 15:24 | Link to Comment Johnny Lawrence
Johnny Lawrence's picture

US Postal Service to close up to 2,000 branches

http://www.bizjournals.com/boston/real_estate/2011/01/us-postal-service-...

Cheer up, soon-to-be laid off postal workers...the stock market is going up!

Mon, 01/24/2011 - 15:36 | Link to Comment SheepDog-One
SheepDog-One's picture

All is well! Soon all of america will be 99 weekers, and stocks are up! HOORAY!

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