Stop Hunt Retraces Post-Election Market Losses

Tyler Durden's picture


Equity markets have pulled away from the rest of risk in a wonderfully dramatic manner this morning as they set their sights on the pre-election highs and the running of the stops. We are now back at Bernanke QE3 spike levels - which we are sure makes perfect sense to someone - anyone, Bueller? For now, it seems like we auctioned up to clear out any last remaining weak hand shorts given the lack of support for this from any other market.


Stocks on their own relative to risk...


Back to Election levels and pre-Bernanke spike levels...


and a close up on the algo ramp-a-palooza stop run...

There is also speculation a customer may have put on a call spread with a $1.5 billion total delta position, although the straight line ramp in ES over a span of minutes which should have been done in a dark pool to avoid slippage, instead of VWAP, confirms there was a much more "demonstrative" component to this latest stop hunt.

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Tue, 12/11/2012 - 12:38 | 3052119 SheepDog-One
SheepDog-One's picture

Oh of course, 'all is WELL', nevermind the collapsed real economy...Must. Retrace. All. Losses.


Tue, 12/11/2012 - 13:41 | 3052318 Fredo Corleone
Fredo Corleone's picture

A "customer" in an algorithmic enviornment ? Certainly not an organic customer -- perhaps some"one" like Ash, from "Alien."

Short the S&P ? "I won't lie to you about your chances, but you have my sympathies."

Tue, 12/11/2012 - 14:02 | 3052402 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Bond rates rose today, which means bond prices dropped today.  Since you have always been a deflationista please take note that you got some deflation today and in the world's second largest market.  The bond market by the way is 10 times the size of the equity market, so this was no small move.

Instead of focusing your furry at stocks why don't you make an effort to look past the shiny green light.

Don't think that you are dutiful just because you talk shit about stocks.  Instead be diligent and focus your hate at the ponzi.  Top to bottom the problem is not stocks, it is the fiat currency that the stocks and bonds are denominated in.  Focus on that and then we can make progress.

Tue, 12/11/2012 - 12:39 | 3052120 Godisanhftbot
Godisanhftbot's picture


Tue, 12/11/2012 - 12:39 | 3052123 mrktwtch2
mrktwtch2's picture

and why is this surprising..if you bought 5 sps at the start of the day and sold them at the close for the last 4yrs you would be up about 2 million with those few 18% pullbacks in there..

Tue, 12/11/2012 - 12:44 | 3052141 SheepDog-One
SheepDog-One's picture

Yep rearview mirror trading WOULD be a wonderful method, problem is it only works if youre a Deity or a central bankster. Anyone using any common sense and logic on those days only gets chumped.

Tue, 12/11/2012 - 14:04 | 3052416 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

You stock bears are just as bad as the bulls.

Tue, 12/11/2012 - 12:41 | 3052124 A Man without Q...
A Man without Qualities's picture

Check out HPQ for complete idiocy...

Tue, 12/11/2012 - 12:41 | 3052129 Undecided
Undecided's picture

oops just shorted, can i get a Dec. 21st hell yeh!

Tue, 12/11/2012 - 13:13 | 3052164 Squid Vicious
Squid Vicious's picture

you mean sharted? that's what usually happens right after you short this mkt.

Tue, 12/11/2012 - 12:42 | 3052132 Shizzmoney
Shizzmoney's picture

It's pretty easy to rig a market when hedge funds and banks are just trading back and forth with each other.

There's a term for this called, "Circle Jerk".

Tue, 12/11/2012 - 12:43 | 3052137 scatterbrains
scatterbrains's picture

So is this move legit ?   Gold's calling bullshit again... so far

Tue, 12/11/2012 - 12:43 | 3052139 edifice
edifice's picture

And gold is down, again. Only in Bizarro World...

Tue, 12/11/2012 - 12:43 | 3052140 Triple A
Triple A's picture

you can't make this shit up

Tue, 12/11/2012 - 12:44 | 3052142 fonzannoon
fonzannoon's picture

Just about once a week that bring that Pento guy out on TV. He announces he has a massive cash position and proceeds to beat up on the other guest who is the typical permabull. Almost everything Pento says sounds logical, and I am just using him as an example. There are plenty more like him. When he is done slapping the other guests around Maria B or whomever asks him "are your clients concerned they are not participating in this market?".

The point is they are going to try and twist his balls with this market until every one of these guys clients is demanding to own something. There are plenty of these guys out there who may be forced to cry Uncle and jump in and keep feeding the beast.

Tue, 12/11/2012 - 12:53 | 3052180 SmoothCoolSmoke
SmoothCoolSmoke's picture

THere are plenty of those guys here on ZH.

Tue, 12/11/2012 - 13:26 | 3052272 slaughterer
slaughterer's picture


Tue, 12/11/2012 - 12:58 | 3052193 Dr. Engali
Dr. Engali's picture

The empire is resilient that's for sure.

Tue, 12/11/2012 - 13:06 | 3052212 fonzannoon
fonzannoon's picture

2008 caught em off guard. they are ready this time. it's gonna be a battle.

Tue, 12/11/2012 - 12:44 | 3052143 Tsar Pointless
Tsar Pointless's picture

Santa Claus is coming to town, dontchaknow?

And, this year, in lieu of bringing presents, he's going to load all of us Amerikkkans onto his sleigh and rescue us from the evil villain known as "Fiscal Cliff".

So, Rudolph, onward to S&P 500 to 1500 and beyond!

Tue, 12/11/2012 - 12:46 | 3052151 Dr. Engali
Dr. Engali's picture

It always pays to go long before the fed meets.

Tue, 12/11/2012 - 12:48 | 3052155 Spastica Rex
Spastica Rex's picture

Buy low, sell high.

Or so I'm told.

I bought a lottery ticket this last weekend.

Tue, 12/11/2012 - 12:51 | 3052166 Dr. Engali
Dr. Engali's picture

I bought a nice shiny gold eagle....lost the damn thing on the car ride home.

Tue, 12/11/2012 - 13:46 | 3052336 reload
reload's picture

DONT WORRY - Your friendly neighbourhood drone centre will find it, once they are done recovering lost cargo from the recent spate of boating accidents.

A full, face value `recovery refund` ok with you?

Tue, 12/11/2012 - 13:23 | 3052156 Everybodys All ...
Everybodys All American's picture

What I have found bizarre of late is the small cap stocks that are just getting price and volume ramped for no reason at all. Just a pure chase the stock higher. Very suspicious ... I think it probably amounts to the most heavily shorted stocks are getting played.

Not a fan of Ritholz but this conveys my suspicions. 

Tue, 12/11/2012 - 12:50 | 3052161 Squid Vicious
Squid Vicious's picture

12 minutes til Wapner.. i mean Boner

Tue, 12/11/2012 - 12:57 | 3052188 nobusiness
nobusiness's picture

even if Bonner has something intelligent to say, he will sound like an ass.  A man with no principals has a hard time defending his positions.

Tue, 12/11/2012 - 13:42 | 3052332 GernB
GernB's picture

I can't recall the last time I saw a politician in Washinton with principals, and they all defend their position regardless of whether it makes sense or not.

Tue, 12/11/2012 - 12:51 | 3052169 bullmkt
bullmkt's picture

theare are far  more"weak' shorts above.soon to be taken out,too

I womder will there be "sheer idiocy/lunacy in the market " or "algotron" to blame.meanwhile the trend is up for the last 4 weeks,what Durden fails to notice

Tue, 12/11/2012 - 12:58 | 3052191 nobusiness
nobusiness's picture

will there ever be strong shorts???

Tue, 12/11/2012 - 13:00 | 3052196 Everybodys All ...
Everybodys All American's picture

There just aren't that many shorts in the market. Period. Most people are simply selling to get out and move to the sideline.

These are very low volume days which tells me there isn't any short covering of any great degree going on in the market.

Tue, 12/11/2012 - 12:51 | 3052170 q99x2
q99x2's picture

Everyone is now convinced by Krugman and Keene that the Benanke bucks must keep flowing. And that there will be green shoots in the spring. Then will come soummer and Fall. Then Winter and more Bernanke bucks then Green shoots in the Spring. Then Krugman and Keene then Bernanke bucks then Summer and Fall.

Tue, 12/11/2012 - 12:52 | 3052173 comrade rally monkey
comrade rally monkey's picture

1432 : Rare Air

Tue, 12/11/2012 - 12:54 | 3052178 Quinvarius
Quinvarius's picture

Kaminskied!  My thesis is bullish.

Tue, 12/11/2012 - 12:56 | 3052187 SmoothCoolSmoke
SmoothCoolSmoke's picture

ZH was logically and rightly skeptical......and the dip buyers laughed all the way to the bank.

Tue, 12/11/2012 - 13:28 | 3052276 slaughterer
slaughterer's picture


Tue, 12/11/2012 - 14:36 | 3052542 GernB
GernB's picture

So what you're saying is markets are not logical. Hmm, interesting thesis.

Tue, 12/11/2012 - 13:51 | 3052364 disabledvet
disabledvet's picture

"the last refuge of a complete and total idiot is arrogance." go ahead Tylers Durden..."tell the world how it really is."

Tue, 12/11/2012 - 13:58 | 3052384 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Prices will continue to rise across the board until the Central Banks take their finger off of the CTRL+P key.

Tue, 12/11/2012 - 15:45 | 3052776 GernB
GernB's picture

Prices will continue to rise accross the board until deflationary pressure overwhelms the abiliyt of central banks to print. Central banks can only buy debt to the extent that debtors are available to sell debt. Logically, debt cannot grow forever. There must come a point where existing debt will be retiring faster than central banks can find new debt to replace it. At that point deflationary pressures will overwhelm central banks and they will be unable to stop the downward spiral.

Tue, 12/11/2012 - 14:32 | 3052535 dvsteenk
dvsteenk's picture

so the fat finger trade of 11,000 ES about one week ago was a planned move? Who's giving the ROI of this trade "a helping hand"?

Tue, 12/11/2012 - 18:00 | 3053330 orangegeek
orangegeek's picture

SP500 hourly showed another push up and we got it.


And the planet Farce lives another day.

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