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Another V-Shaped Stock Recovery - But Rates And Credit Ain't Buying It

Tyler Durden's picture





 

From last Friday, the S&P 500 had decoupled somewhat (trading in a 10 point range) from credit markets (which had widened notably) while spot VIX had caught up (and over-taken) stocks. Today saw HYG (the high-yield bond ETF) trade sideways to lower all day long, catching down to its credit derivative market cousins, as VXX was the lever of choice to ramp stocks to test the week's highs once again (and scratch a few more stops). However, while AAPL made it up to the lows of the last swing down amid thin volumes, the last hour saw mid-dated volatility being bought which pushed VXX higher and reverted it towards rates and credit un-exuberance. Treasuries ended the day green once again and the USD drifted higher (though most of FX traded in extremely tight ranges). Silver rose further, Gold trod water, and oil played some catch up to the precious metals. Tech outperformed (thanks to AAPL) but financials (apart from some early vol) did nothing - despite Mario Monti's call that "the crisis is over." Another low-range, low volume, mediocre trade size, close-near-the-open day in stocks with bonds bid - and futures fade after-hours.

 

They tried to lever HYG but its call-caps were done, so once again they shifted back to VXX and it was compliant (interest rate complex did not play along)...

 

S&P 500 futures stage another V-shaped recovery to unch on the week - taking out a few more stops then fading back to VWAP for the close... and the infamour 8amET turnaround story...

 

 

AAPL filled the gap from the 12/28 lows and VWAP (and faded into the close)...

 

Treasury yields continue to slide - so much for the great rotation (oh please make it true, it was such a nice meme there for a day or two...)... yields dropping each day this week

 

 

Equity markets remains alone relative to credit this week...

 

Low range day but cross-asset-class correlation picked up with stocks reverting to their ETF cousin's view of the world into the close...

 

It seems once again, given the range-bound week, that the algos are running out of leverage (VIX limited given the term-structure, HY limited by call constraints, rates limited by POMO, and USD limited as world plays ping-pong with verbal intervention)... I guess we 'hope' for magical earnings...

 

Charts: Bloomberg and Capital Context

 

Bonus Chart: Gold and the S&P 500 have recoupled from 1/4/13 - moving tick for tick this afternoon...

 

Bonus Bonus Chart: Some 2011 Debt Ceiling Deja-Vu in VIX Term Structure...

 

Bonus Bonus Bonus Chart: The breadth today was very weak...


 


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Wed, 01/16/2013 - 17:22 | Link to Comment michiganmaven
michiganmaven's picture

Another day living in a Bankster Benanke controlled world.... love it... can I choose to take the "other" pill now?

Wed, 01/16/2013 - 17:39 | Link to Comment Groundhog Day
Groundhog Day's picture

You can't take the blue pill once you've taken the red pill...I tried.

Wed, 01/16/2013 - 18:13 | Link to Comment sotto
sotto's picture

And this is what happens:  http://economiccollapsenews.com/

Wed, 01/16/2013 - 17:45 | Link to Comment Groundhog Day
Groundhog Day's picture

coolio got it, all you have to do is replace gangsta with banksta

You want to tell me what this is all about?

As I walk through the valley of the shadow of death
I take a look at my life and realize there's notin left
Cause I've been blastin' and laughin so long that
Even my ma'ma thinks that my mind is gone
But I ain't never crossed a man that didn't deserve it
Me, be treated like a punk, you know that's unheard of
You better watch how you talkin, and where you walkin
Or you and your homies might be lined in chalk
I really hate to trip, but I gotta loc'-
As they croak I see myself in the pistol smoke, fool
I'm the kinda G the little homies wanna be like
On my knees in the night
Sayin' prayers in the street light

Been spending most their lives living in the Gangsta's Paradise
Been spending most their lives living in the Gangsta's Paradise
Keep spending most our lives living in the Gangsta's Paradise
Keep spending most our lives living in the Gangsta's Paradise

They got the situation, they got me facin'
I can't live a normal life, I was raised by the strip
So I gotta be down with the hood team
Too much television watchin' got me chasin' dreams
I'm an educated fool with money on my mind
Got my ten in my hand and a gleam in my eye
I'm a loc'ed out gangsta, set-trippin banger
And my homies is down, so don't arouse my anger, fool
Death ain't nuthin but a heart beat away
I'm livin life do-or-die-a, what can I say?
I'm twenty-three now, but will I live to see twenty-fow'?
The way things are goin' I don't know

Tell me why are we, so blind to see
That the ones we hurt, are you and me

Been spending most their lives living in the Gangsta's Paradise
Been spending most their lives living in the Gangsta's Paradise
Keep spending most our lives living in the Gangsta's Paradise
Keep spending most our lives living in the Gangsta's Paradise

Power and the money, money and the power
Minute after minute, hour after hour
Everybody's runnin, but half of them ain't lookin
What's goin on in the kitchen, but I dont know what's cookin
They say I got ta learn, but nobody's here to teach me,
If they cant understand it, how can they reach me?
I guess they can't; I guess they won't
I guess they front; that's why I know my life is outta luck, fool!

Been spending most their lives living in the Gangsta's Paradise
Been spending most their lives living in the Gangsta's Paradise
Keep spending most our lives living in the Gangsta's Paradise
Keep spending most our lives living in the Gangsta's Paradise

Tell me why are we, so blind to see
That the ones we hurt, are you and me
Tell me why are we, so blind to see
That the ones we hurt, are you and me

Wed, 01/16/2013 - 19:30 | Link to Comment TruthInSunshine
TruthInSunshine's picture

3018445 

 


Fractional Reserve Bankster's Paradise

by Benny & The Inkjets

As I walk through the valley of the shadow of debt
I take a look of my life, and realize there's nuthin' left
'Cuz I've been brassin' and laughing so long that
Even my laid off BofA teller thinks my mind's gone


But I ain't never crossed a central bankster who didn't deserve it
Used to cap them in the ass, you know that's not unheard of


You'd better watch how you're talking and where you walking

I really hate to trip but dope fiat took my hope

What was I thinkin', should've bought more gold

 

As they print I see myself in the ink spray, FOOL.
I'm the kind of g that little homies wanna be, as I swagger on up near 33 Liberty
Like on my knees in the night sayin' prayers under Marriner Eccles glowing street lights

Yeaaa...

[Chorus]

Been spending most their lives livin' in a Fractional Reserve Bankster's Paradise

Been spending most their lives livin' in a Fractional Reserve Bankster's Paradise

Keep spending most their lives livin' in a Fractional Reserve Bankster's Paradise

Wed, 01/16/2013 - 17:28 | Link to Comment hedgeless_horseman
hedgeless_horseman's picture

 

 

Lead, copper, and brass going ballistic.

7.62 NATO available online...for $2.00 / rnd!  Ouch.

This is 7.62 x 51mm Silver State Armory 168gr. Sierra Hollow Point Boattail Military / LE Ammo. This ammo was made for a military contract. This is match grade ammunition, an excellent sniper round. Each cartridge of Silver State ammunition begins with precision made non-corrosive brass case. Silver State Armory uses quality primers, high performance propellants, and bullets from trusted names like Sierra, Barnes, and Nosler. Each cartridge is hand inspected to ensure quality and to deliver superior performance. Serious shooters rely on Silver State Armory ammunition to make the first shot count! It is new factory ammunition, non-corrosive, and reloadable. This ammo comes packed in 20rd. boxes.

 

$39.95

 

Wed, 01/16/2013 - 17:30 | Link to Comment BandGap
BandGap's picture

Ordering in bulk is no longer possible. Scalping.

Wed, 01/16/2013 - 17:56 | Link to Comment hedgeless_horseman
hedgeless_horseman's picture

 

 

More and more people are begining to ask, "A year from now, will I rather have bought 100 shares of Facebook, or a DSA FAL and a Trijicon scope?"

http://www.dsarms.com/

Miscellaneous firearms currently in stock
1. 3 Available - SA58 medium weight 16" barrel with Steyr type short flashider, SAW grip, humpback buttstock & extreme duty scope mount $1783
5. 2 available - SA58 21" standard fixed buttstock rifle $1700
8. 1 available - SA58 Medium weight with fixed buttstock $1700
12. 2 available - SA58 Bull barrels with freefloat handguards and 21" barrel $1850
13. 1 available - SA58 Medium weight 21" barrel with free float handguard $1770
14. 1 available - SA58 Medium weight 18" barrel with free float handguard $1770

23. 2 Available - SA58SPR Special Purpose Rifle $4,795

 

05/10/2012

Item 2

Develop a basic mindset. Here are some ideas. Commit to prepare for zombies, so that currency collapse, EMP, hurricanes, revolution, world war, or anything else will seem relatively mild. Understand that the time to make a plan and prepare is before, not after a zombie invasion. Understand that there is no way you can plan or prepare for every contingency, but doing something today goes a long way to peace of mind, and eliminating any regrets should the shit actually hit the fan. Realize that everything is likely to cost more next year, if you can get it, so better to buy it now. Acknowledge that nobody really knows if, what, when, or how anything in the future is going to happen...it is all just speculation. Finally, always remember that, "on a long enough timeline the survival rate for everyone drops to zero," so don't get too worked up, or go into debt, just because of this little exercise in paranoia.

http://www.zerohedge.com/contributed/2012-19-10/fear-we-are-returning-time-history-where-it-common-occurrence-fight-ones-life

 

Wed, 01/16/2013 - 19:01 | Link to Comment q99x2
q99x2's picture

Bout the price of an ounce of gold.

Wed, 01/16/2013 - 18:02 | Link to Comment Freddie
Freddie's picture

Boattail?  Oh that scares me.  Reminds me of my boat that became swamped and all my gold, guns and ammo went over the side.  The Germans and Dutch better be more careful than I was.

People better start gettin good at scoped .308 and bolt action.    Spray and pray may not be an option when the SHTF.

Wed, 01/16/2013 - 17:24 | Link to Comment BandGap
BandGap's picture

Pretty soon one variable is going to upset the cart.

Wed, 01/16/2013 - 17:30 | Link to Comment tawse57
tawse57's picture

The only variable that will upset the cart is when Ben has to pop out to Walmart to buy some more printer ink.

Wed, 01/16/2013 - 19:29 | Link to Comment chump666
chump666's picture

The S&P HFTs blasted stops all session.  Anyone trying to fix a tight short, got taken out.  Wall Street trying trying take profits was tempted again by HFTs offers, so longs are still being held.

This market will only move on the downside when something bad (real bad) hits the wires, till then...

...meantime it's a central bank liquidity playground with parasitic HFTs. 

 

Wed, 01/16/2013 - 20:47 | Link to Comment chirobliss
chirobliss's picture

while AAPL made it up to the lows of the last swing down amid thin volumes

 

Well, not quite-better than 20 million shares traded, only a little less than yesterday. Tis a poor showing when dogged bias toots the horn, but sadly, even the best of ZH is propaganda for personal biases.

Wed, 01/16/2013 - 20:59 | Link to Comment IMA5U
IMA5U's picture

IG was unch'd to slighty tighter and so was hy

 

 

Thu, 01/17/2013 - 02:00 | Link to Comment Yen Cross
Yen Cross's picture

 V's , U's. Caddy Shack Economics. Tyler runs long duration composits.

  The spread between sp500/trin /convergence was intresting.

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