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Pump, Dump, And Pump; Black Gold Red, Stocks Green, Bonds Blue

Tyler Durden's picture





 

Umm yeah...close-to-close, equity indices were mixed (Dow small red - HP/IBM, NDX/SPX small green on closing rampfest) amid dismal volumes but for anyone that paid attention to the debacle in the markets today, this was another odd one. Thanks to EUR strength's correlated power (retracing last night's France loss), stocks trickled up all morning into the European close; Bernanke suggested he was not omnipotent and stocks dumped 13 S&P points (~1%) to yesterday's day-session open; and then on no news - as Greece remains unfixed and cease-fire deadlines come and go, we pumped ingloriously on small lots and stupid volume up to VWAP/unch - paused for thought - and then ran to the day's highs just after the close day-session close in S&P futures. Treasuries suffered - yields up 5-6bps on the day as our broad risk-asset proxy lifted along with modest moves in FX carry pairs and USD weakness into the close. Oil was headline-maker (away from BBY and HPQ that is) - down almost 4% from the highs yesterday but closing still green on the week just above $87 as Israel re-flared. Credit was less noisy and VIX compressed a little more to 15.11% at the close (lowest in 5 weeks).

 

S&P 500 futures pumped up into and through the open, dumped on Bernanke, then pumped into the US close after bouncing off yesterday's open...notably VWAP hardly budged today - suggesting firmly that little 'risk' was added on the day and algos in charge...

 

 

Bonds playing catch up to EUR and Stocks reality... all lined up by the late afternoon today as volume disappeared. These kind of reversion moves in Treasuries (as they finally give in to stock pressure) to equity's 'reality' normally market a short-term trend turn and given stocks move overall today, we suspect (especially heading into a very long weekend) that equities have run their course for now (but then who knows what the BIS or AAPL will tomorrow)...

 

It appears from both a credit perspective and a broad risk-asset perspective that stocks basically overshot to the downside today on Bernanke's comments and merely auctioned back up after finding some technical support (AAPL VWAP, ES day-session open yesterday, EUR yesterday's US open)...

 

AAPL failed to extend its gains from the last two days generational low...once again bouncing off VWAPs in an oh-so-natural human trading pattern...

 

While HPQ's ~12% drop knocked 12 points off the Dow (which closed -7 points), IBM's mere 0.6% drop knocked 9 points off... gotta love that index eh?

Broadly speaking, equities appeared to overshoot risk in general to the downside on Bernanke's comments and then spend the rest of the day catching back up...

 

Oil dominated the headlines in commodity-land...

 

Volume today was weak in stocks; average trade size was also small (one of the lowest of the year) which tends to reinforce the algo-based moves we saw. HYG ended small red but we did see some chunky blocks (seemingly to the sellside given the market's reaction).

It seems like most of the pros have left the building in FX and credit (and futures pits overall) unwilling to add/remove too much exposure here - perhaps explains equities excess moves today. More of the same for the rest of the week potentially as only algos and a few day-traders left to muppet stocks.

Just like yesterday's close - there was larger blocks and heavier volume into the ramp - which tends to be the pros selling into strength as opposed to starting trends and overpaying.

Charts: Bloomberg and Capital Context

 


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Tue, 11/20/2012 - 17:32 | Link to Comment SolidSnake961
SolidSnake961's picture

just another normal day

Tue, 11/20/2012 - 17:38 | Link to Comment Boilermaker
Boilermaker's picture

60% of the time, it works every time.

Tue, 11/20/2012 - 17:40 | Link to Comment The Shootist
The Shootist's picture

When will they ban shorting stateside? Everyone knows Keynesian markets only go up.

Tue, 11/20/2012 - 19:50 | Link to Comment disabledvet
disabledvet's picture

working great in the euro-zone isn't it...

Tue, 11/20/2012 - 17:40 | Link to Comment Traianus Augustus
Traianus Augustus's picture

Best example so far as to how rigged these markets are.  Bennie must have been misunderstood.  Markets are now just another CB tool.

Tue, 11/20/2012 - 17:41 | Link to Comment slaughterer
slaughterer's picture

Bernanke dip got bought handsomely to torch the bears.   ES 1400 now in reach if the EZ masters decide to announce a saved Greece overnight without 999.  

You have to be tactically long in a market like today.  

Tue, 11/20/2012 - 17:45 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Short term bullish into the long weekend?

Too much dynomite in the hole to do that. 

Just keep stacking....

Tue, 11/20/2012 - 17:57 | Link to Comment chump666
chump666's picture

There will be profit taking to Dec, then rally. Traditionally.   EZ bs and Bernanke's bs has been priced in, what hasn't is total war in the middle east.   The Israel skirmish with Palestine is a pr-lude to Iran, in other words a smoking gun attempt at getting Iran and also Syria to join in.

Gonna get ugly.

Tue, 11/20/2012 - 22:03 | Link to Comment disabledvet
disabledvet's picture

I think Ben's about to bounce a check. Israel knows they only have one shot at this...I think they'll slam into the Sinai HARD and FAST. All the "chess pieces" are in place. "it's in God's hands now."

Tue, 11/20/2012 - 19:14 | Link to Comment luna_man
luna_man's picture

 

 

"slaughterer"...

 

This "bear", has felt the pain!...And will be back for more, until I can't!

 

I will NEVER give the CRIMINALS, the satifaction...poor house here we come?

Tue, 11/20/2012 - 17:46 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

I'd like to point out that AAPL bounced when it gave its div away, just like any of you traders should realize, bears or not.

Tue, 11/20/2012 - 17:52 | Link to Comment chump666
chump666's picture

You can't short HFTs till the shift their MA's downward, which looks likely, the ranges are just too tight.  IMO longs will start cutting till the Dec/end year rally...but all out war in the middle east will crush equities.

Tue, 11/20/2012 - 17:58 | Link to Comment Water Is Wet
Water Is Wet's picture

Salesforce.com loses $220 million, stock goes up!  WOOOHHHHOOOOOOOO!!!  Who wouldn't buy this company for $20 billion?

Tue, 11/20/2012 - 18:47 | Link to Comment orangegeek
orangegeek's picture

Completing an upward correction before the next downturn.

 

http://bullandbearmash.com/chart/sp500-hourly-bounces-up-for-no-particul...

 

Company reports are showing weakness and virtually all are revising down for next quarter.  Let's see how long this crap lasts - thought it would have ended sooner, but it is a process, not an event.

Tue, 11/20/2012 - 18:54 | Link to Comment XtraBullish
XtraBullish's picture

BUY BUY BUY and TORCH those fuzy-cheeked hedgies that think they know the game. NEVER understimate the replacement power of equities within an inflationary Barnanke-esque spiral.

Tue, 11/20/2012 - 19:15 | Link to Comment muppet_master
muppet_master's picture

spx high = 1390

then dropped to 1377....back to 1387 and closed up 1 point to 1388....THIS IS CALLED RIDING YOUR LONG POSITIONS (from spx 1354 last week) and waiting for 1470ish before selling !!

i enjoyed my life..watched/monitored the casino today for NO MORE THAN 20 minutes total...how many fools spent 10+ hours today and made what?? = nothing?? LOL !!

once again...i also called the TOP of spx @ 1474 day after QE3 LOL !!!

Tue, 11/20/2012 - 19:19 | Link to Comment Water Is Wet
Water Is Wet's picture

You're a legend in your own mind.

Wed, 11/21/2012 - 01:24 | Link to Comment Itch
Itch's picture

He's out standing in his field...with his goat. fnar fnar.

Tue, 11/20/2012 - 19:27 | Link to Comment FinalCollapse
FinalCollapse's picture

This is the best example that this stock market became a giant Ponzi. Totally disconnected from fundamentals for a long time. 

Congrats to Bernanki and the rest of Crimex. Great job - you are assured a prominent place in the Hall of Shame.

Tue, 11/20/2012 - 19:40 | Link to Comment overmedicatedun...
overmedicatedundersexed's picture

what are the stops set at for a market fall..5% and they close her down. and no open until they can float it from the open. national security means the elite never can lose.

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