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NYSE Short Interest Drops To Lowest In 2010

Tyler Durden's picture





 

According to the just released NYSE short interest update, the number of shares short on the NYSE group has just dropped to 2010 lows, after dropping by over 1 billion since the August highs. This has occurred pretty much in linear fashion: in the last 4 months, there has been just one two week period in which the shorts have increased. What is just delightfully ironic, is that even as broad market volume has collapsed, biweekly short covering has surged on a relative basis. In essence, the bulk of the market buying has been short covering, which traditionally is always 'offer-lifting' heavy, as shorts are willing to pay any price to cover underwater positions, especially if there is an accelerant involved, such as when a repo desk advises its "client" that State Street has decided to force squeeze financial stocks for the nth time since March 2009.

The chart below shows that after standing firm through the end of September, shorts have capitulated and the bulk of the weak hands has by now been washed out.

The second chart shows the near relentless covering in biweekly short positions:

 


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Tue, 12/28/2010 - 16:04 | Link to Comment goldmiddelfinger
goldmiddelfinger's picture

Record high margin balances, record low CBOE put/call ratios, AAII at 60% bulls: Buy em up!

Tue, 12/28/2010 - 16:15 | Link to Comment ZeroPower
ZeroPower's picture

Exactly.

Low short interest, numerous recommendations of SPX double digit growth in 2011, low VIX. All signs of complacency.

I normally disagree with people who call anything (i.e. tops) but i wouldnt be surprised for January to start off with a bang indeed...

Tue, 12/28/2010 - 16:21 | Link to Comment thepigman
thepigman's picture

Complacency doesn't count anymore

as there no market except that

for kiting equities between the Fed and primary dealers.

We know from the court documents anything

can be repoed, so you can bet anything

IS repoed on a nightly basis. What

a fraud.

Tue, 12/28/2010 - 16:26 | Link to Comment thepigman
thepigman's picture

The insolvent TBTF banks have no source of income

except for trading with the Fed

Tue, 12/28/2010 - 22:59 | Link to Comment Fish Gone Bad
Fish Gone Bad's picture

TBTF has pretty much an unlimited source of income from the Fed.  Eventually something bad will happen that will pull the rug out from pretty much everyone.  Until a comet hits the earth, I would expect this game of extend and pretend to continue for the foreseeable future, as this is the only game in town.

Tue, 12/28/2010 - 17:04 | Link to Comment hugovanderbubble
hugovanderbubble's picture

+1 article thx tyler.

Tue, 12/28/2010 - 16:04 | Link to Comment thepigman
thepigman's picture

Good.... as crackpot Ben sends rates

soaring, there's no one left to buy.

Freefall, baby.

Tue, 12/28/2010 - 16:43 | Link to Comment Boilermaker
Boilermaker's picture

Wrong, he'll just quote stuff the shit out of it higher.  Bigger hammers are readily available.

Tue, 12/28/2010 - 21:35 | Link to Comment Golden monkey
Golden monkey's picture

Fucken right. Sheeple needs to boil, in Benny's kitchen.

Tue, 12/28/2010 - 16:08 | Link to Comment DavidC
DavidC's picture

The move today, after London's close at 4:30 p.m. has been classic HFT stuff, 3, 4, 5 pips up, then 1, 2 down and then up again.I was seeing this on a regular basis through the Summer, always occurring after the London close.

DavidC

Tue, 12/28/2010 - 16:08 | Link to Comment Racer
Racer's picture

Bank holiday in UK today and yesterday, so only futures HFT in the game for FTSE

Tue, 12/28/2010 - 16:44 | Link to Comment BeeTee
BeeTee's picture

London wasn't open today. Bank holiday.

Tue, 12/28/2010 - 16:49 | Link to Comment DavidC
DavidC's picture

I'm aware of that.

All spreadbet companies have been open and trading.

DavidC

Tue, 12/28/2010 - 16:08 | Link to Comment Chappaquiddick
Chappaquiddick's picture

Look at he NASDAQ100 - that grand daddy IHS indicates at target price of 3000 - wtf???

 

Oh yeah - hyperinflation.

Tue, 12/28/2010 - 16:12 | Link to Comment Racer
Racer's picture

Zimbabwe Ben will make sure of it

Tue, 12/28/2010 - 16:14 | Link to Comment goldmiddelfinger
goldmiddelfinger's picture

IHS ?

Tue, 12/28/2010 - 16:24 | Link to Comment JohnG
JohnG's picture

Inverse Head & Shoulder formation.

Tue, 12/28/2010 - 16:58 | Link to Comment goldmiddelfinger
goldmiddelfinger's picture

Ahh. Thanks. Was thinking IHS Corp (IHS) had done a big-O government study!

Tue, 12/28/2010 - 16:29 | Link to Comment gigeze787
gigeze787's picture

Fed's WSJ lapdog 'reporter', Jon H, reporting that Comrade Chairman Ben has a call in to Fox News' 'free market' expert, Karl Rove, to ask him where the "MISSION ACCOMPLISHED" banner -- last seen in May 2003 -- was stored when 43 left office. Rove would neither confirm nor deny that the banner will hang above the entrance of the GWB43 Presidential Lah-berry. 

Calls to Rove's former boss were answered with, "Ben who?....Global Financial Crisis?...which globe would that be? Housing bubble implosion...not on my watch...we had the "Ownership Society" to make sure ALL of the serfs were owned by the TBTF aristocracy...and we accomplished our mission!"

 

Tue, 12/28/2010 - 16:29 | Link to Comment Sudden Debt
Sudden Debt's picture

Can't complain :)

My BAC warrants first got hammerd, recovered, hammerd again and have now exploded to the upside :)

SHOW ME THE MONEY!!!

Tue, 12/28/2010 - 17:07 | Link to Comment hugovanderbubble
hugovanderbubble's picture

hahaha

+1

u always make me smile and laugh¡

Tue, 12/28/2010 - 16:32 | Link to Comment HarryWanger
HarryWanger's picture

Why would anyone be short a market that will continue to get Fed money pumped into it? Common sense, not a contrarian indicator. 

Tue, 12/28/2010 - 16:44 | Link to Comment Boilermaker
Boilermaker's picture

Has anyone told you to go fuck yourself today?  No?  Ok, go fuck yourself then.

Tue, 12/28/2010 - 16:47 | Link to Comment Robot Traders Mom
Robot Traders Mom's picture

Well played Boilermaker. Although Harry is my nephew, his IQ is only about 40. That is 5 points higher than my son.

Tue, 12/28/2010 - 21:36 | Link to Comment Golden monkey
Golden monkey's picture

Fucken right once again.

Tue, 12/28/2010 - 16:58 | Link to Comment cosmictrainwreck
cosmictrainwreck's picture

besides, Wanker, your buddies didn't even have enough muscle to juice that fuckin' Dow to a full +30..... love that limp dick chart. see that duoble-top from 3:00 to 3:45? talk to me tomorrow

Tue, 12/28/2010 - 17:00 | Link to Comment goldmiddelfinger
goldmiddelfinger's picture

Today is the last day to settle equities regular way into 2010

Tue, 12/28/2010 - 17:01 | Link to Comment Sophist Economicus
Sophist Economicus's picture

Best not to short when it seems obvious.   Best to short when everybody thinks this is the worst time to short.   WHEN the market tanks, and it will, the ride down is always faster than the long, long, long road up.   SHorting need not be done in one big plop ya know.   One could feather in a position, ya know.   Wonder what the euphoria felt like in the many 50% up moves in the Nikkei or the DOW in the 1930s.   

 

COMMON SENSE says underwater consumers, declining real estate values, low interest rates that hurt savers and seniors, 20+% unemployment, speculative bubbles in commodities, etc do not a BULL MARKET engender.    Might be wrong though, but it's my money, I think I'll keep playing it this way....

Tue, 12/28/2010 - 17:40 | Link to Comment SheepDog-One
SheepDog-One's picture

No one in the equity market, who cares what it does?

Tue, 12/28/2010 - 16:49 | Link to Comment rosiescenario
rosiescenario's picture

Who can fight the Fed POMO? I got out of all my shorts (except one) 3 months ago. If fundamental analysis no longer works (between the Fed and the algo's), how can one short stocks (unless armed with some very good inside information)?

Tue, 12/28/2010 - 16:54 | Link to Comment Boilermaker
Boilermaker's picture

Can I interest you in an IYR short position and some put options?  The REITs are only pushing triple digit valuations.  You're sure to cash in big.  I'll even sell at a discount.  Let me know! XOXO

Tue, 12/28/2010 - 16:56 | Link to Comment thepigman
thepigman's picture

POMO is transfering the fed's dollars

to the banksters and the

fed is running up big losses doing it. Which means the

bankster are still in fucking trouble

with no loan growth.

Tue, 12/28/2010 - 19:28 | Link to Comment Waterfallsparkles
Waterfallsparkles's picture

The FED is transfeering all the BAD DEBT on to its Balance sheet.

What happens when we have to bail out the FED?

Tue, 12/28/2010 - 16:51 | Link to Comment thepigman
thepigman's picture

Oh, Wanker....did you know the Fed's

only 50 basis points away from insolvency?

How do you think that'll go over with

all their little friends, hmmmmmm?

Tue, 12/28/2010 - 16:58 | Link to Comment thepigman
thepigman's picture

Picture Ben wearing a top hat and a

barrel....you like?

Tue, 12/28/2010 - 17:03 | Link to Comment thepigman
thepigman's picture

His Caribbean off balance sheet

subsidiary will have to sell their junker

equities.

Tue, 12/28/2010 - 17:42 | Link to Comment SheepDog-One
SheepDog-One's picture

Americans are such complacent ignorant sheeple that even if theyre in leg irons at a forced labor camp, they'd believe 'all is well' as long as they were marched past a TV screen showing the DOW was up +20 today!

Tue, 12/28/2010 - 23:09 | Link to Comment StychoKiller
StychoKiller's picture

Oceania has once again exceeded its quota for Victory gin!  All hail, Big Brother!!

Tue, 12/28/2010 - 16:59 | Link to Comment Id fight Gandhi
Id fight Gandhi's picture

Everything is just fine.

Market ignores a weak confidence number today. Doesn't consumer confidence correlate with consumer spending, aka bad retail? Never mind. Just buy.
housing double dipping. Never mind, just buy the fucking thing.

Tue, 12/28/2010 - 17:03 | Link to Comment goldmiddelfinger
goldmiddelfinger's picture

Today is the last day to settle equties regular way into 2010-

just sayin

Tue, 12/28/2010 - 17:07 | Link to Comment cosmictrainwreck
cosmictrainwreck's picture

interesting..... I guess "we'll see" (as always)

Tue, 12/28/2010 - 17:07 | Link to Comment thepigman
thepigman's picture

Dontcha just love the idea of the

TBTF banksters making the fed itself insolvent?

50 basis points away, folks.

 

Tue, 12/28/2010 - 17:08 | Link to Comment goldmiddelfinger
goldmiddelfinger's picture

Peeps n Media too bullish on Gold! Gimme a break. TCK was $4 a year ago now it's $60 fer cryin out loud

Tue, 12/28/2010 - 21:44 | Link to Comment Golden monkey
Golden monkey's picture

Monkeys got TCK for 3.65$. Once uppon a time, markets

were not rigged.

Tue, 12/28/2010 - 23:13 | Link to Comment LudwigVon
LudwigVon's picture

Time to sell TCK.

Bank that $56/share paper profit -->2oz Ag/share

Tue, 12/28/2010 - 17:15 | Link to Comment lunaticfringe
lunaticfringe's picture

Ooooh La La. The big rally is ON!

After washing all the shorts out, I am sittin' chilly just waiting for POMO to end at about the whole time the house of cards collapses.

So get on in there Harry Wanger, get ur last 15 mins worth of POMO induced buying in. In about 6 months, I'll have a boot on your throat. Figuratively speaking, of course.

Tue, 12/28/2010 - 17:50 | Link to Comment walküre
walküre's picture

maybe if we had an alternative currency.

after a jubilee, a currency reform and a fresh start ... maybe you'll see stock valuations drop to reality

 

Tue, 12/28/2010 - 17:38 | Link to Comment walküre
walküre's picture

just one simple question:

where would the liquidity go if stocks got sold off?

cash is worthless

stocks will not get sold on a broad scale just as metals will continue to climb higher.

the story of 2011 is the currency fiatsko

Greece's default is already accepted fact and probably priced in somewhere, somehow.

a billion USD today is not worth the same as it was 2009, let alone 2008.

Tue, 12/28/2010 - 18:24 | Link to Comment End Game
End Game's picture

Do you consider gold an alternative currency?  CNBC's Joe says it's an old relic.  Curious that central banks still hold it as a reserve asset then.  Perhaps CNBC knows more than multiple central bankers world wide.  Don't fight the Fed.  Own gold!

Tue, 12/28/2010 - 19:05 | Link to Comment Chappaquiddick
Chappaquiddick's picture

Gold is the get out of jail free card.  All those tossers have to do is re-establish the gold standard and revalue gold to circa $500,000/oz and the US is solvent again (that includes the off balance sheet shit as well -> $110Tr), unfortunately, being the insane and crooked fucks that they are, they've stolen all the gold and therefore they've consigned everyone to the apocalypse.

cHappy New Year

Tue, 12/28/2010 - 19:19 | Link to Comment huggy_in_london
huggy_in_london's picture

hahaha... well if you really think they'd do that then i am pretty sure they'll confiscate individuals holdings just before that.... hahahaha... 

Tue, 12/28/2010 - 19:20 | Link to Comment huggy_in_london
huggy_in_london's picture

re spx .... hard to see it rallying with bonds getting pounded almost daily.  It'll crack with bonds sooner or later.....probably sooner i'd say.

Tue, 12/28/2010 - 19:22 | Link to Comment Waterfallsparkles
Waterfallsparkles's picture

FED has in effect made Short Selling Illegal.  Not in reality but in policy. With the FED pumping money in to the Stock Market every day there is no room for Short Sellers.

The problem that I see is that anyone Short has covered.  Many at a loss.  But, Short Sellers do play a role in the Market as when Stocks go down they are the ones who bid to cover to cushion the fall.  With no Short Sellers to cushion any fall and the HFT Traders that will not provide Bids when the Market goes down there is no support for the Market.  It creates its own vacuum with no Bidders on the downside.

The Flash Crash gave us a glimpse of what can happen and more than likely will happen. 

What happens if the Congress does not raise the Debt Ceiling?  What happens if there is no QE 3?  Really, how much in Debt can the FED push on the average American before it becomes unsustainable?  This of course to insure Wall Street Bonuses at the expense of the Americans and what will end up being almost 4 generations of Debt.

I know Wall Street does not care.  Why, because by then they will have taken their gains and moved them overseas.  They will have deposited their Gold, Silver, Copper and all other cash in other Countries, so it will not matter what happens to Americans and the US.  Even American Corporations have kept their Money and Wealth Overseas.  Just look at Microsoft that Borrowed money from their Overseas Company to pay a Dividend.  They would not bring that Money into the US.

I as an American hope we are not doomed but from what Major Corporations and Wall Street are doing I am not sure anymore.

Tue, 12/28/2010 - 20:38 | Link to Comment WTF2
WTF2's picture

CASH  IS  KING forget what the pundits say.  Deleveraging panic on way.  Trades settle in cash not gold.  The calendar is very important.  BEWARE OF 11'. WTF2

Tue, 12/28/2010 - 21:47 | Link to Comment Golden monkey
Golden monkey's picture

How can we be sure that the market volume will really go up?

Tue, 12/28/2010 - 23:08 | Link to Comment TexDenim
TexDenim's picture

No one thinks these number have any meaning now, because they are widely disseminated and because there no longer are any investors, just traders who all read ZH. But we'll see. I think 2011 Q1 is going to be nasty indeed. Look out below.

Wed, 12/29/2010 - 00:42 | Link to Comment Freddie
Freddie's picture

Just buy the f*cking dip.   Ben Shalom is coming with QE 4, 5 and 6.

Tue, 12/28/2010 - 23:36 | Link to Comment lbrecken
lbrecken's picture

this is all have to say......via Richmode Fed

    District manufacturers reported that raw materials prices increased at an average annual rate of 2.53 percent from November's reading of 2.23 percent. Finished goods prices rose at a 2.13 percent pace, compared to 2.10 percent last month.
    Looking forward, respondents expected that the prices they pay will advance at a 3.70 percent pace compared to November's reading of 3.30 percent. Additionally, contacts looked for finished goods prices to increase at a 2.41 percent annual rate, which was somewhat above last month's expectation of 1.81 percent.

Tue, 12/28/2010 - 23:53 | Link to Comment nathan1234
nathan1234's picture

Ben will play the market both ways . Go short using his left hand and long with his right hand. And then claim he is not aware of any such actions.

As usual a True lying SOB

Wed, 12/29/2010 - 03:34 | Link to Comment dehdhed
dehdhed's picture

i hadn't noticed it before so maybe it's new, but for pages at the bottom of the home page, i usually click 'next' but where i clicked took me to like june of 2009.  i guess there's a new link for 'last'.

at first i hadn't noticed until i read headlines that didn't make any sense.  i figured it out after a bit but kept reading old posts just to see how things have changed.

one thing that surely hasn't change is the total negativity spewed by posts at ZH.  hell, i've had so many multi baggers since the 18 months ZH has been posting it's incessant pessimism,  it's a wonder they have any credibility left.   or rather, i'm sure they're the champs of glum, but how profitable is that?

all this impending doom being posted around here has probably caused a lot of people to miss an extremely profitable 18 months.   personally, i think the continuous onslaught of pessimism is to further their agenda .. whatever that may be.  i have no idea what agenda they must have.

18 months of constant negativity?  really?  is there really people out there that can't begin to express an ounce of hope?  ... ever?   i'm sure they'll have their day, someday, .. and in all the chaos that ensues they'll be extremely delighted.   just makes me wonder how sad must be the life lived which is constantly upset that things aren't getting worse, much faster than hoped.

Wed, 12/29/2010 - 07:35 | Link to Comment thepigman
thepigman's picture

Everything is worse except for the

rigged market which cheats natural

selection by giving you low IQers

more money.

Wed, 12/29/2010 - 07:26 | Link to Comment MallaKite
MallaKite's picture

Personally I think pasive retail investors are playing a blinder.....just clip out 10% a go for every 1000 points on the dow over 10000  and forget about it. Play the fed at its own game......  retail scarpers into strength:-D

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