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Volume Surges To Year's Highest, As 20 DMA Support About To Be Tested

Tyler Durden's picture





 

The technicians out there will be salivating over the action in the ES today, which has continued to drip all day, and is now a point away from the 20 DMA at 1,311.30. In this relentless meltup, this moving average has been breached just several times since Jackson Hole. Yet the one to keep an eye out for is the 50 DMA, which has been a key support over the past 6 months. Should that level be taken out (1,282), the next level is 1,234, after which there is no support for a long, long time. Yet the most, or least for the cynics, surprising observation is that today's ES volume is about to hit the highest of the year, taking out the last January surge... which also was on major downswing. At least the banks made some money on equity commission trading, although with the Treasury curve flattening rapidly, that may not be much of a consolation.

 


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Tue, 02/22/2011 - 16:50 | Link to Comment raya123
raya123's picture

It is clear from the market action in these last minutes that the FED / POMO cannot stop a market that wants to move downward.

Tue, 02/22/2011 - 16:52 | Link to Comment Ragnarok
Ragnarok's picture

Remember that the Fed wants lawmakers to beg for QE3, so a modest controlled decline is permitted.

Tue, 02/22/2011 - 17:05 | Link to Comment Dr. Richard Head
Dr. Richard Head's picture

Damn skippy. The markets are no longer a tool for investment, rather a tool for confidence/fear. Just think Audit the Fed and Bernadict Sanders of VT.

Tue, 02/22/2011 - 17:10 | Link to Comment pragmatic hobo
pragmatic hobo's picture

QE3 will likely mean the revolution lands on US shore.

Wed, 02/23/2011 - 15:22 | Link to Comment Watauga
Watauga's picture

What "revolution"?  "The revolution" lands on US shore--what is that?  Seriously, totalitarian regimes that have bilked their nations for decades experience unrest fostered by Islamists and American weakness and, all of the sudden, because of just another stupid movement toward unpayable debt, "the revolution" is going to "land on" our shores?  Maybe, just maybe, the disagreements about unions, government debt, government obligations, pensions, benefits, jobs, and so forth that we are seeing in Wisconsin and Ohio will result in some movement within the political system to make changes, but "revolution" landing on our shores?  Come on.

Tue, 02/22/2011 - 17:16 | Link to Comment raya123
raya123's picture

In the face of selling pressure, the intra-day POMO pushes have been good for no more than 20 to 50 points.... only about 30 today into the close.  That's not going to get the FED very far in controlling what could become an ugly decline.

Tue, 02/22/2011 - 17:17 | Link to Comment Quinvarius
Quinvarius's picture

It is clear from the market action in these last minutes that the FED / POMO cannot stop a market that wants to move downward.

 ....For at least a few minutes

Tue, 02/22/2011 - 17:43 | Link to Comment unununium
unununium's picture

Time to STFD.

Tue, 02/22/2011 - 20:35 | Link to Comment Clockwork Orange
Clockwork Orange's picture

@raya, who says the $8B pomo has to be used to go long?!  the TBTFs have collected all the longs they want.  today they wiped out 2 1/2 weeks worth of longs.  they held the market right where they wanted it thru feb opex on friday. now, by smashing a market they wouldn't let drop by more than 3 pts for weeks, they can collect some shorts that they can wipe out for the march opex.  monopolistic, unchecked scumbags.

Tue, 02/22/2011 - 16:50 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

There is plenty of support all the way down. It all depends upon how many FRN's Ben wishes to print, then burn. This will all come down to a test of wills.

Will he print some more or will he let it burn down some more.

Tue, 02/22/2011 - 16:55 | Link to Comment william the bastard
william the bastard's picture

Has this thesis been run by E-Erian for confirmation yet?

Tue, 02/22/2011 - 16:51 | Link to Comment jus_lite_reading
jus_lite_reading's picture

No worres. Kamikazi Ben will step in and save the day with a few more billion. Oil going higher is no problem for Dr. Deficit. He can save the world from total financial collapse in 15 minutes.

Tue, 02/22/2011 - 20:37 | Link to Comment Clockwork Orange
Clockwork Orange's picture

i hope someone somewhere has 15 minutes alone with ben when this thing blows.

Tue, 02/22/2011 - 16:52 | Link to Comment doomandbloom
doomandbloom's picture

yumm...lovin these dips..!

Tue, 02/22/2011 - 16:54 | Link to Comment Guy Fawkes Mulder
Guy Fawkes Mulder's picture

I'm lovin' your avatar.

Tue, 02/22/2011 - 16:54 | Link to Comment Sophist Economicus
Sophist Economicus's picture

If this market breaks the 50 day before May, I'll eat that flying shoe!!!!

 

 

Tue, 02/22/2011 - 17:06 | Link to Comment Dr. Richard Head
Dr. Richard Head's picture

May I suggest the port wine as a chaser.

Tue, 02/22/2011 - 16:56 | Link to Comment Great Unwashed
Great Unwashed's picture

It's 3:55 and S&P down about 29 points. Any chance for a green close? You can do it!

Tue, 02/22/2011 - 16:55 | Link to Comment Cleanclog
Cleanclog's picture

The Bernank is losing control.  Very very scary.  And scarier for Obama. And all the governors, senators, bank presidents, and powers that have just looked the other way from the people for too long.  Hoping for peaceful settlement, but not too optimistic on that.  Urgh.

Tue, 02/22/2011 - 16:56 | Link to Comment poor fella
poor fella's picture

HEY!! whatever....  Bernankenstein better fix the NFL or the U.S. is going to make Libya look like a grammer school playground gone a little rough patch.

Tue, 02/22/2011 - 17:09 | Link to Comment NotApplicable
NotApplicable's picture

Nobody will care though until they flip on the tube and find that figure skating is the top televised sporting event of the day, and it's not even an Olympic year!

So, I'd say we've got until the final out in the World Series before things get ugly.

Tue, 02/22/2011 - 17:40 | Link to Comment duo
duo's picture

egg-friggin-zactly.  No NFL in the fall and you start eating away at "normalcy bias". I shudder to think what no "Idol", or "Bachelor" would do to disrupt society.

So far the 79 cent beef taco going away at Taco Bell hasn't caused any riots.

Tue, 02/22/2011 - 18:56 | Link to Comment poor fella
poor fella's picture

Whoozawhaddahfck! No more 79 cent tacos - I will punch somebody in the head!! That's gonna spill over, unless, we're still able to buy obscene amounts of bean burritos for ten bucks...  might let it slide.

Hahaha, NoAppliccasiones! If it's ice skating - so be it - is there a good site to get the spreads? Are investment opportunities available such as derivatives on whether a skater lands a triple?!?!? Let's make some funny money sonny before goldman gets its bloody beak pounded into the wide open alpha profits of fabulously hypnotic flaming fabrics of body-hugging profits leaping airborn like unfettered FRN confetti from here to Times Square!!!!   weeeeeeeeeeeeeeeeeeeeeeee

Tue, 02/22/2011 - 19:48 | Link to Comment andybev01
andybev01's picture

So instead of bread & circuses we have tacos & football?

Tue, 02/22/2011 - 21:08 | Link to Comment poor fella
poor fella's picture

noooooooooo! - burritos, skating, and skating burritos. It's the new Bud Bowl.

Tue, 02/22/2011 - 16:55 | Link to Comment morph
morph's picture

better vol, avg. by old standards.

Tue, 02/22/2011 - 16:56 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

Radio talk show host Todd Schnitt is selling ALL stocks at the close today, going to 100% cash.

Tue, 02/22/2011 - 17:02 | Link to Comment william the bastard
william the bastard's picture

WTF? Is he Cramer?

Tue, 02/22/2011 - 17:42 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

LOL william!

No, he is just a conservative talk show host.

Tue, 02/22/2011 - 16:56 | Link to Comment trav7777
trav7777's picture

Pt and Pd are getting totally smashed...a worrisome sign if you are long

Tue, 02/22/2011 - 17:45 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

Yes, trav.

Pt and Pd are for optimists, in that they would likely do very well if world car production goes up.

Tue, 02/22/2011 - 17:52 | Link to Comment unununium
unununium's picture

They are very sensitive to the market/economy.  Compare their performance in late 2008 to Au/Ag.

Tue, 02/22/2011 - 16:59 | Link to Comment PeterSchump
PeterSchump's picture

Down markets in rising volume....hmmm.  Have to go with the only strategy that has worked for the last two years.  BTFD.

Tue, 02/22/2011 - 17:25 | Link to Comment PeterSchump
PeterSchump's picture

I would otherwise agree, but it is Ben buying all of the monkeys with his endless fiat.  ...unless yesterday's line on Euro CNBC signalled the (at least real and not nominal) top for the time being by stating "Stocks attracting inflows due to inflation!"

Tue, 02/22/2011 - 17:36 | Link to Comment Guy Fawkes Mulder
Guy Fawkes Mulder's picture

http://en.wikipedia.org/wiki/Zero_stroke

Here we come.

edit: I hope Harry, Hamy & Co. get this.

Tue, 02/22/2011 - 17:03 | Link to Comment Hephasteus
Hephasteus's picture

NYSE. How the electronic mall of america turned into the electronic fall of america.

Tue, 02/22/2011 - 17:06 | Link to Comment RobotTrader
RobotTrader's picture

Lots of stuff cracked big today:

Copper

Cotton

Platinum and Palladium

Wheat

Cyclicals

Banks

Energy stocks

Most of the IBD Top 50

Tue, 02/22/2011 - 17:21 | Link to Comment lieutenantjohnchard
lieutenantjohnchard's picture

a while back the old catfish mouth infamously said all rosie had to do to make a fortune was buy at the bottom at 666 and ride it to the top. any old fool could do it, just like the catfish mouth.

so might one infer the catfish mouth is calling a top, because it's just as easy to make a fortune by selling the top, and buying back at the next 666 or whatever low level. any old fool can do it, right catfish mouth.

btw: i notice gold, silver and oil aren't on the catfish mouth list. gentleman jim sinclair sends his regards to you catfish. ditto max keiser, who you might be interested to know is still in business, contrary to your prediction.

Tue, 02/22/2011 - 17:41 | Link to Comment RobotTrader
RobotTrader's picture

Might have a trend change tomorrow if there is more follow through selling on the HPQ warning.

I'll be ready to go long big into SH or DOG if that happens.

You better hope that gold doesn't pull a wheat or copper move within the next few days if "risk off" algos sell anything and everything.

Tue, 02/22/2011 - 18:04 | Link to Comment lieutenantjohnchard
lieutenantjohnchard's picture

no worries. i have an investing thesis predicated on my world view, and timing the market is not my bag.

Tue, 02/22/2011 - 17:54 | Link to Comment duo
duo's picture

The Bernank can only crash commodities by taking the rest of your precious market down with it.  Are you prepared?

Tue, 02/22/2011 - 17:05 | Link to Comment SpeakerFTD
SpeakerFTD's picture

12212 DOW close

12/21/12  Apocalypse

Hmmm, foreshadowing ala 666 S&P low?

[Yeah, it's a stretch, but I'm bored]

Tue, 02/22/2011 - 17:05 | Link to Comment disabledvet
disabledvet's picture

i thought for sure we'd have a double dip last fall and boy was i wrong.  it's not Ben that's moving our economy forward but extraordinary General and Admiral "ship."  I actually think Bernanke has done far more harm than good by forcing the "atoritiees" to take their eye off the ball and actually believe in his "lead to gold" theory of "debt printing" as growth.  the jury is still out...i mean the word "jury" when i say it...if what Bernanke has done is the problem and not just neutral.  Clearly it is inarguable that what he has done is not positive.  The war expansion ends that theory.

Tue, 02/22/2011 - 17:06 | Link to Comment HedgeFundLIVE
HedgeFundLIVE's picture

how many ES traders are actually watching the 50 DMA?  they said the same thing about 20 DMA etst, but we broke that like butter last time.

wwww.hedgefundlive.com

 

Tue, 02/22/2011 - 17:06 | Link to Comment SwingForce
SwingForce's picture

Wholly Hannah BTFD

Tue, 02/22/2011 - 17:13 | Link to Comment John Law Lives
John Law Lives's picture

$4 gasoline coming to a pump near you?

http://www.cnbc.com/id/41721766

The Ben Bernanke says QE works.  I am sure the bankers and oil sheikhs just love him.

Tue, 02/22/2011 - 17:15 | Link to Comment Id fight Gandhi
Id fight Gandhi's picture

BTFD comes out tomorrow right? Stories of Libya is old news.

Some fucker on shitnbc was saying oh keep buying, where else you gonna out your money. Erin said, gold? He laughed and said oh that's just speculation not investing.

Tue, 02/22/2011 - 17:27 | Link to Comment barbarika
barbarika's picture

As I ate lunch today, i noticed that "chicken piccata" at the workplace cafetaria used to comprise of a whole chicken breast (with both halves) for $4.49 until last week. Today, magically it became 50% of the previous size with the same price!! I am still hungry :-( I don't what QE3 will do to my favortie chicken piccata.

Tue, 02/22/2011 - 17:27 | Link to Comment barbarika
barbarika's picture

As I ate lunch today, i noticed that "chicken piccata" at the workplace cafetaria used to comprise of a whole chicken breast (with both halves) for $4.49 until last week. Today, magically it became 50% of the previous size with the same price!! I am still hungry :-( I don't what QE3 will do to my favorite chicken piccata.

Tue, 02/22/2011 - 17:46 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

I was in Costa Rica last week.  The locals are complaining about high food and gasoline prices.  

Coming to a state and city to all of us soon.

Tue, 02/22/2011 - 17:50 | Link to Comment DoChenRollingBearing
DoChenRollingBearing's picture

deleting dupe post.

Tue, 02/22/2011 - 18:15 | Link to Comment chet
chet's picture

One of my favorite lunch spots put up a very explicit sign last week:  "due to higher cost for wheat, rice, etc. we unfortunately had to raise our prices".  14% increase on my gyro and hummus plate.

Tue, 02/22/2011 - 17:31 | Link to Comment 99er
99er's picture

ES

The pause that refreshes.

http://www.zerohedge.com/forum/99er-charts-0

Tue, 02/22/2011 - 17:45 | Link to Comment buzzsaw99
buzzsaw99's picture

The ramp will resume as soon as the volume subsides.

Tue, 02/22/2011 - 17:46 | Link to Comment huggy_in_london
huggy_in_london's picture

1295 is the first stop for ES.  Its the big trend support line from the start of the august ramp, i mean, move.  

Tue, 02/22/2011 - 17:45 | Link to Comment huggy_in_london
huggy_in_london's picture

1295 is the first stop for ES.  Its the big trend support line from the start of the august ramp, i mean, move.  

Tue, 02/22/2011 - 17:56 | Link to Comment nathandegraaf
nathandegraaf's picture

The shorts are being optimistic, living in a world where the game isn't rigged.  The Chairman is blowing this whole mother up, either from ignorance or obstinance (side note: isn't it funny th best compliment you can give Pimp Daddy B is that he might not be corrupt, just stupid/stubborn?). 

Like has been said in these comments, he wants the world on its knees begging for QE3 and he shall give it to them.  We'e going parabolic and we're taking the S & P down to 330 by 2015 in my humble opinion.  The shorts won't clean up until our currency is totally dilluted, which is kind of the point.  I mean, how could the banksters come out on top if they don't wind up with ten times the value on forty times the paper?

Straight to WWIII with a fiat bullet. 

 

Tue, 02/22/2011 - 18:04 | Link to Comment Ancona
Ancona's picture

Fuck paper....gold and silver bitchez.

Tue, 02/22/2011 - 18:35 | Link to Comment Leo Kolivakis
Leo Kolivakis's picture

Hmmm, maybe they'll bring it down to the 50-day before they BUY THE DIP! You still don't get it, she's heading right back up. Today's action was on the VXX:

Tue, 02/22/2011 - 20:09 | Link to Comment geminiRX
geminiRX's picture

How many times has "wolf" been cried too early? You may have a valid point.

Tue, 02/22/2011 - 19:07 | Link to Comment sellstop
sellstop's picture

Stock markets look ahead.

In the early stages of inflation, stocks look good. Later, interest rates will choke off growth.

US stocks are priced in US dollars. At some point as the USD collapses it will not be wise to hold assets that represent dollars. Especially from a foreign buyers perspective.

Stocks were down sharply today. Probably will be down tomorrow. Pay attention to the next rally. The quality of that rally will give clues to the health of this stock market.

gh

Tue, 02/22/2011 - 19:21 | Link to Comment chump666
chump666's picture

good there you go, volume  = short positions.  that's your correction forming right there.  

there will be no buying on dips if oil stays above 95

Tue, 02/22/2011 - 20:05 | Link to Comment HedgeFundLIVE
HedgeFundLIVE's picture

i believe we won't see a bounce at least for another ten trading days. just trading the odds:

http://www.hedgefundlive.com/blog/bulls-beware-today-was-a-very-rare-atypical-day

Tue, 02/22/2011 - 20:45 | Link to Comment chump666
chump666's picture

yeah i would agree hard to gauge on 10 days though...but with short position starting up and volume spikes it's a good sign.  longs on oil, gold/silver consolidation if there is dip buying it will be there.

if asia goes red again...still HFT trading is obsessed with the 100ma supports.

need a 'event' to break the 50ma's, that happens.  flash crash.

finally some volatility swing trades.

Tue, 02/22/2011 - 20:17 | Link to Comment tallystick
tallystick's picture

Long copper won't be an effective hedge if you're short silver?

Tue, 02/22/2011 - 21:45 | Link to Comment le_cinque
le_cinque's picture

For the first time, I won't BTFD just b/c everyone says it is a dip, but it is not, it is a f*cking cliff.

Tue, 02/22/2011 - 22:18 | Link to Comment geminiRX
geminiRX's picture

I hope you're right - but in order for there to be a crash, there has to be something for money to swing into. A stock market crash typically requires money to flee into government debt instruments and FRNs - I am not sure if there is confidence there anymore. Interesting days indeed.

Wed, 02/23/2011 - 15:25 | Link to Comment Watauga
Watauga's picture

Gold will pullback to $1250 or less, and silver to $25 or less.  Short term.  Long term bull in tact.  Sell off at peak levels today or in next few days, and buy back when gold and silver reach near bottom of pullback.  Gold to $1600+ and silver to $40+ by end of 2012.

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