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NYSE Volume: Lowest Of The Year

Tyler Durden's picture





 

And while the market grinds up for the 8th day in a row, the bad news for the brokers is getting acute. To wit: NYSE volume today was the lowest so far in 2011. With nearly half the quarter in the books, stock trading is persisting at the same Q4 levels that forced banks to announce a plunge in trading-related commissions. As we noted back in August, the only way for stock volume to surge is for a concerted selling event, which is the only time stock volume is beyond the good old vapor we have grown to love and expect each and every day there is an increasingly meaningless meltup in the stock market. And if we are correct about a transition from a QE2 surreality to an (in)visible hand free market occurring some time in April/May, stock volume will continue becoming progressively smaller until they finally spike in roughly three months.

 


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Tue, 02/08/2011 - 17:22 | Link to Comment 101 years and c...
101 years and counting's picture

is the Fed insolvent yet?  with their continuation of buying bonds and bonds subsequently falling.....

 

 

Tue, 02/08/2011 - 17:27 | Link to Comment metastar
metastar's picture

FED is not insolvent. They changed the rules to make their problems the problems of the Treasury and thus the American people.

So, the bankstas, complicit with our criminal, corrupt, and illegitimate government are shafting the people yet again.

Tue, 02/08/2011 - 17:30 | Link to Comment redpill
redpill's picture

When you can use future generations as the tax burden equivalent of indentured servants before they are even born as your financial backstop, solvency is never a problem.  Just auction off the living standards of another few million future Americans at a time.

Tue, 02/08/2011 - 17:39 | Link to Comment blunderdog
blunderdog's picture

Seriously hoping someone will help me out here, because I'm still at a total loss as to how the Fed can become "insolvent" in any way...

The Fed--who are they required to PAY?

Maybe my perspective is too simpleminded.  My understanding is that "insolvent" means you can no longer make the interest payments to your creditors based on current operating cashflow.

How does this concept even apply to the Fed? Who are the creditors?

Tue, 02/08/2011 - 18:03 | Link to Comment metastar
metastar's picture

This is the article to which I refer...

 

"Finally, It’s the Fed That Has Become Too Big to Fail"

"What the central bank did was revise and advantage its own rules so that if some financial catastrophe were to inflict huge losses on the Federal Reserve System, the U.S. Treasury would take the hit, not the Fed itself....".

 

http://www.zerohedge.com/article/finally-it%E2%80%99s-fed-has-become-too-big-fail

 

And the related article:

http://www.cnbc.com/id/41198789/Accounting_Tweak_Could_Save_Fed_From_Losses

Tue, 02/08/2011 - 18:52 | Link to Comment blunderdog
blunderdog's picture

I appreciate the reply--but I read that article too, and didn't quite understand it then either.  Yes, yes, the Fed is going through all kinds of hijinks to "protect itself" from failure.  It's the protection part that has me so baffled.

WHO would "shut down" the Fed if it suffered unacceptable losses? 

As I understand it, the only possible answer is "the Treasury," but of course that's nonsense because the Treasury needs the Fed to print the money to pay the gummit bills that can't be paid without the notes that the Fed is already no good for.  The Fed has no mark-to-market.  No one is lending it money except its own members.

Is this supposed to all come down to the 10% fractional requirement that says the Fed can't lend at 0% to its members without enough to cover?  Is THAT what this fuss is all about?

Uy uy uy!  XD

Tue, 02/08/2011 - 20:45 | Link to Comment CU1981
CU1981's picture

♦♣♠? NEW SLOGAN ALERT ♥?♣

 

BTFR

 

Buy the F'in Rally !!

Tue, 02/08/2011 - 22:20 | Link to Comment blind squirrel
blind squirrel's picture

@blunder, if the Fed's assets (= US treasury portfolio) is less than their liabilities (= Treasury dept. and institutional deposits) wouldn't that make the Fed insolvent?  They obviously have an operating budget for salaries, cap ex, etc.  If they don't generate enough revenue to fund operations wouldn't that make them insolvent?

sorry, I'm not an accountant, and I don't play one on tv.

Wed, 02/09/2011 - 02:51 | Link to Comment StychoKiller
StychoKiller's picture

Welcome back my friends to the show that never ends,

we're so glad you could attend, come inside, come inside! -- ELP

Tue, 02/08/2011 - 23:03 | Link to Comment holdbuysell
holdbuysell's picture

Makes me wonder what the Fed is preparing for.

Tue, 02/08/2011 - 17:29 | Link to Comment whatsinaname
whatsinaname's picture

TD - But if trading volumes have moved to currencies etc.. maybe banks are making some money on trading spreads in those areas even if stock trading is dying down ?? just a thought..

Tue, 02/08/2011 - 17:31 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

With the latest accounting gimmick, the Fed can never become insolvent since all negative balances are moved to the Treasury. And as long as there are electronic ones and zeros for the Fed to journal entry into existence, the US Treasury/taxpayer can never be insolvent, just in debt up to it's eyeballs.

That is until no one wants our electronic paper. Welcome to the insanity.

Tue, 02/08/2011 - 17:42 | Link to Comment whatz that smell
whatz that smell's picture

the perfect trade?

two robots trading one share of appl at $1000000000000000000000...

...god help us in the future.

Tue, 02/08/2011 - 17:23 | Link to Comment SashaBelov
SashaBelov's picture

Time to add some more may and june puts in portfolio? Or just to simply short anoter one june E-mini S&P? This story just can't end bad for shorts, I guess...

Tue, 02/08/2011 - 23:52 | Link to Comment asteroids
asteroids's picture

No just move completely to cash and wait. Starve the beast and it'll die. It's only a few months. And don't be tempted by a couple of percent moves.

Tue, 02/08/2011 - 17:24 | Link to Comment redpill
redpill's picture

But Rick, stocks were up

/Liesman

 

Tue, 02/08/2011 - 20:08 | Link to Comment Problem Is
Problem Is's picture

Some one needs to chalk up their pool cue and bank Lies-man's baldy cue ball of a head into the corner pocket...

Wed, 02/09/2011 - 02:53 | Link to Comment StychoKiller
StychoKiller's picture

A case of confusing the map with the territory (so sad!) :>O

Tue, 02/08/2011 - 17:30 | Link to Comment bob_dabolina
bob_dabolina's picture

Low volume and a deteriorating  housing market is good for the banks.

XLF up .75%

I'd rather choke myself and shit all over myself than be in stocks right now long or short. This is a nightmare.

U-6 @ over 16% and Apple is now valued at higher then life itself.

Tue, 02/08/2011 - 17:34 | Link to Comment El Hosel
El Hosel's picture

  Check  out XLY, a few of the components ( MCD,AMZN,F,TGT ) are well of their highs yet XLY itself is at its high.  ... Freaking "Rhino Horn" the last week or two

   

Tue, 02/08/2011 - 18:41 | Link to Comment poor fella
poor fella's picture

Put all you have into Apple, Salesforce, and Chipotle - These are perfect Facebook acquisitions!   One day they may even buy GS.

It's not without risk though - if Facebook doesn't play this right, AOL may buy them in 5 years for significantly less.

Tue, 02/08/2011 - 17:27 | Link to Comment MiningJunkie
MiningJunkie's picture

When markets are manipulated, participants flee, hence the low volume.

These conditions are eerily like 1987. Only difference is that the Benjamin Shalom Barnanke is in the back room with 4 tonnes of ink and the memeograph machine printing more counterfeit scrip than post WWI Germany...

Tue, 02/08/2011 - 17:29 | Link to Comment Greater Fool
Greater Fool's picture

Dunno, looks pretty similar to last Feb's volumes to me.

Tue, 02/08/2011 - 17:41 | Link to Comment topcallingtroll
topcallingtroll's picture

Good point! But must verify for myself. Perhaps volumes should be seasonally adjusted!

Tue, 02/08/2011 - 19:26 | Link to Comment holmes
holmes's picture

Didn't it snow somewhere today?

Tue, 02/08/2011 - 17:34 | Link to Comment whatsinaname
whatsinaname's picture

India like Egypt has a huge inflation problem and local politics is all about inflation right now. Ruling party may lose its power in the next election if food keeps soaring. Meanwhile DBA = 34.5 and SLV = 30+

 

Tue, 02/08/2011 - 17:37 | Link to Comment El Hosel
El Hosel's picture

   India "Sick"

.... Can't we just build them some printing presses and fix it?

Tue, 02/08/2011 - 17:47 | Link to Comment topcallingtroll
topcallingtroll's picture

Looks like they are tapped out for this last round of beggar thy neighbor. China......you next......anybody in the market.for a chinese ghost city? Check them out on google.

Wed, 02/09/2011 - 02:57 | Link to Comment StychoKiller
StychoKiller's picture

Third rule of Fight Club:  If someone yells "stop!", goes limp, or taps out, the fight is over.

Tue, 02/08/2011 - 17:39 | Link to Comment whatsinaname
whatsinaname's picture

Meanwhile Brent crude stands at about the same levels as March 2008. (which was just before the 2008 crude hysteria started and Brent soared to 130+) Enough to the break the back of the European and Asian economies since they purchase oil mostly in Brent pricing ?? I guess thats even more bad news for India. 

Tue, 02/08/2011 - 17:35 | Link to Comment smoke and mirrors
smoke and mirrors's picture

"To wit: NYSE volume today was the lowest so far in 2010."

^It is 2011

 

Tue, 02/08/2011 - 17:43 | Link to Comment topcallingtroll
topcallingtroll's picture

Gold 36000 booyah!

Tue, 02/08/2011 - 17:38 | Link to Comment buzzsaw99
buzzsaw99's picture

Seeing the market back at these levels makes me feel good. I think I'll go shopping.

Tue, 02/08/2011 - 17:41 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

LOL

Hey Ben, it's working. I just found another greater fool. Keep poring on the QE and we might just make it back to port alive.

Tue, 02/08/2011 - 18:06 | Link to Comment buzzsaw99
buzzsaw99's picture

And now, with all the madoff/hedge fund criminal types locked up I can feel secure in the knowledge that the stock market is fair for everyone.

Wed, 02/09/2011 - 02:59 | Link to Comment StychoKiller
StychoKiller's picture

Another shot of POMO-Ade, sir/madam?  :>D

Tue, 02/08/2011 - 17:39 | Link to Comment topcallingtroll
topcallingtroll's picture

I wonder what robo has to say and.i wish he would add pretty pictures of young women. It does look kinda sucky. A big volume finish to the week would be nice, as long as it is upside volume!

Tue, 02/08/2011 - 17:41 | Link to Comment kaiserhoff
kaiserhoff's picture

Liquidity is always an illusion.

                Michael Milken

Tue, 02/08/2011 - 17:58 | Link to Comment mynhair
mynhair's picture

Bless you, SeekingAlpha:

http://seekingalpha.com/article/251449-the-long-case-for-avalon-rare-metals

Wonder if this article came out at 11:10 am today.....

Tue, 02/08/2011 - 17:59 | Link to Comment Zexe
Zexe's picture

Why do you pathetic perma bears keep insisting on the trade volume....the market just went up, it is that plain and simple. You wait for the never coming crash and when you see it did not arrive you find excuses in the "low volume"....LOL pathetic

Tue, 02/08/2011 - 18:59 | Link to Comment Johnny Lawrence
Johnny Lawrence's picture

It's not a question of being bullish or bearish.  It's looking at the facts. 

Fact: P/E10 is over 24 right now, and in the last 140 years, the market has ALWAYS experienced a correction that ultimately brought the market below its historical P/E10 of 16.3, many times resulting in a single-digit multiple.  There have been ZERO exceptions.

 

Fact: Bullish sentiment is at levels we also saw in late 2007.  What happened?

 

Do you believe this time is different?

Tue, 02/08/2011 - 22:05 | Link to Comment blind squirrel
blind squirrel's picture

@JL, QE is unprecedented in the US. Doesn't that make it different this time?  (I'm cringing as I write the words but I think it really is uncharted territory.)

Wed, 02/09/2011 - 09:56 | Link to Comment Johnny Lawrence
Johnny Lawrence's picture

My point is that there's always something that's unprecendented....the internet, real estate, the telephone, the railroad, Ben Bernanke's floppy testes...There's always something in which people cite as a "new era."

 

Wed, 02/09/2011 - 02:34 | Link to Comment BlakeFelix
BlakeFelix's picture

Ya. With tiffanys computer bernanke doesn't need to cut down forests to print a trillion dollars.

Tue, 02/08/2011 - 18:02 | Link to Comment Ferg .
Ferg .'s picture

Compare a chart of the DJIA ( or the S&P ) from the 2009 lows to present with a chart of volume over the same period . There's a perfect inverse correlation . Hardly indicative of a healthy bull market .

Tue, 02/08/2011 - 18:09 | Link to Comment Ancona
Ancona's picture

Low volume?? Fucking pathetic is a bit more realistic. How about that last of the day melt up? At 3:26 the DOW was at 87,800,225 and at the close it was at 126,608,716.

Sooooo the invisible hand dips in at the end of the day and juices up 38,808,491 shares? What the fuck!?!?!

That's over 30% of the entire volume in a half hour.

Again....What the fuck?

Tue, 02/08/2011 - 18:10 | Link to Comment Tense INDIAN
Tue, 02/08/2011 - 20:04 | Link to Comment Problem Is
Problem Is's picture

No, but if you hang your ass out your window, Google can photograph your ass for Google maps.

Almost as good...

Tue, 02/08/2011 - 18:36 | Link to Comment Obaminator
Obaminator's picture

YES...Counter-Intuitivly Markets, Any Market indeed, will tend to Rise in times of Low and Very Low volume. And this story actually spills the beans on Why this is when he asks if the only players on low volume are just in it to pump prices for their own benefit - Bingo.

Here is what happens: When only a few people are trading, they effectively "fix" the price, thus raising their portfolio "value", giving them more leverage to buy yet more. With low volume there can be no large selling of any sort, why? Simple - Those people trading refuse to sell at anythihng less than "X". Period. In fact this can be done for a long long time...a few people trading can actually rise a stock price to astronimical levels far beyond anything the company is even capable of making. This can and will continue UNTIL those people pumping the price higher attempt (someties with fabulous success) to cash out, effectively selling an artifically pumped stock to someone else. Then...with these few players cashed out and inactive, real bids and asks start rolling in...but at those high prices very very few people will bid, and at some point someone hits that "Sell at Market" button, and a bid collapse and flood of selling commenses.

We are witnessing this currently in most equities due to the HFT platforms allowed to run 75-80% of daily trades....what...did you expect to happen...and at a certain point, they will decide its time to "bag the profits".

The cute thing is when they take $1000 and pump it to $1,000,000 sell for $990,000, then wait for the stock to crash and buy out everyone for...$1000...HAHAHAHA!!!

Tue, 02/08/2011 - 20:54 | Link to Comment chump666
chump666's picture

quite a  good analysis that,

...but you forgot the short sell side of a hedge, since HFT short rapidly, you should see a nice correction till a bottom. i hear 5%, 10%, 20% US indexes going neg

Tue, 02/08/2011 - 20:01 | Link to Comment Problem Is
Problem Is's picture

Stay away sheeple... Or rack of lamb is what's for dinner on Wall Street...

Tue, 02/08/2011 - 20:46 | Link to Comment chump666
chump666's picture

and the insider sell/buy ratio is going upward...USD/CHF up: check your Jan 2011 charts. We got risk aversion creeping in.

Tue, 02/08/2011 - 21:20 | Link to Comment sellstop
sellstop's picture

Or the low volume in the stock markets could be because Joe Sixpack from the suburbs is finally getting out of his bond funds, and putting more money into stocks. Because he finally feels confident about the economy from what he sees in his daily life. Not to mention that the stock market keeps going up. But, either way, when Joe puts money in he tends to leave it, because he won't admit that he is wrong until well after the fact. There are a lot of Joe Sixpacks moving their money, and it will be an event that may last for a long time. Joe likes to buy the dips. Even he knows to buy cheap. So the dips get bought.

The smarty pants traders, who take great pride in their market timing skills think Joe is a schmuck, so when they see him get in they feel obligated out of a sense of superiority to fade Joe's trade. But, there are alot of Joe's out there. And the smarty pants traders get to cover their short bets time and time again as the wave of relentless buying from all of the Joes goes on and on. You see, Joe doesn't read all the inside information. He doesn't know all of the reasons that the stock market should go down. He sees what they say on the evening news, and thinking himself the contrarian, he buys.

This melt-up could go on for a long time. With brief, sharp corrections that Joe will buy into.

If all the Joes are buying and holding, doesn't it make sense that volume will decline, since shares are taken out of the market? And the smart money knows how to "sit tight!".

 

gh

Tue, 02/08/2011 - 21:26 | Link to Comment Eric Cartman
Eric Cartman's picture

Okay, this is where I get confused... DARK POOLS. A lot of institutional investors use them so doesn't this account for much of the low volume? Is there something I'm missing here?

Tue, 02/08/2011 - 21:43 | Link to Comment The Axe
The Axe's picture

the SPY use to average over 300,000,000 million shares traded on a day. Last year it averaged roughly 172,000,000.  now it has a difficult time BREAKING 100,000,000. 

Tue, 02/08/2011 - 22:41 | Link to Comment New_Meat
New_Meat's picture

check /es volume.

and correlation w/SPY

just wonderin'

- Ned

Tue, 02/08/2011 - 23:43 | Link to Comment sellstop
sellstop's picture

There are less traders using the SPY than there was before. More alternatives. ETF's etc....

Wed, 02/09/2011 - 02:43 | Link to Comment Grand Supercycle
Grand Supercycle's picture

The overextension on daily and weekly charts is very concerning ...

http://stockmarket618.wordpress.com

Wed, 02/09/2011 - 07:49 | Link to Comment anvILL
anvILL's picture

Shorts are going to make some profit at the end of the day,
if they can survive until the end of the day.

Do NOT follow this link or you will be banned from the site!