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WTI Plunges As ~$250 Million Notional Crosses In 2 Seconds

Tyler Durden's picture




 

It would appear that the combination of the last day of trading for the March futures contract and some earlier concerns (via CAT) over global growth are enough to warrant a huge  block of selling in the April futures contract for WTI crude. Of course, the now standard rumor of a commodity fund liquidation is doing the rounds - 'standard' in so much as whenever there is a sudden unexplained sharp sell-off in the commodity space it is trotted out. As an aside, this drop in WTI perfectly recouples it with gold -1.7% on the week. It appears, as Nanex notes, that this 'two-second 2500 contract block' ~$250mm plundering of all resting market orders then caused CME to halt trading for 10 seconds. Human? hhmm

... as we tweeted

 

April Futures plunge on huge volume...

 

and Brent follows WTI... as the spread widens...

 

 

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Wed, 02/20/2013 - 12:21 | 3259677 DJ Happy Ending
DJ Happy Ending's picture

Time to buy bitchez

Wed, 02/20/2013 - 12:24 | 3259692 SHEEPFUKKER
SHEEPFUKKER's picture

Stack the phyzz black gold?

Wed, 02/20/2013 - 12:30 | 3259729 greyghost
greyghost's picture

well now crude and silver and gold??? are they losing control in chicago? hang on, we will wait for zero hedge to inform us as to whom the big sellers are!

Wed, 02/20/2013 - 12:54 | 3259843 nope-1004
nope-1004's picture

PCT, plunge creation team.

 

Wed, 02/20/2013 - 13:03 | 3259883 r101958
r101958's picture

Yep. It is all a matter of managing perceptions, all while allowing the TBTF's to take profits.

Wed, 02/20/2013 - 13:09 | 3259903 strannick
strannick's picture

WTI is starting to sound like silver. Crush the commod complex before the Fed announces an increase in QE.

Wed, 02/20/2013 - 13:38 | 3260069 r101958
r101958's picture

Or crush the commodity complex (and bonds and bank deposits) so the retail/small investor has nowhere else to go but to equities. Then when equities are sufficiently bubbled up the big boys (TBTF's) will then take out the money they are currently propping it up with leaving the retail/small investor to bite the bullet....again.

Wed, 02/20/2013 - 15:13 | 3260596 jballz
jballz's picture

"sometimes a cigar is just a cigar. If it is a cigar being shoved up my snatch in the oval office, well it is still just a cigar." -Monica lebowski.

Anyway you people need to stop investing or trading or whatever you call it. Go find a slot machine. I don't know what your imaginary world looks like, where gold goes to a million billion zillion and everything else does too, having watched silver go from four to forty nine, the bullshit from the colored section never changes. It is always supposed to be higher and a down day is a conspiracy. It's fucking retarded. If commode went straight up every day every dumb fuck on the planet would just buy and get rich. Which I guess is what this is, you are dumb fucks who want to buy something and get rich. Same with crude, goes from twelve to a hundred and a five dollar drop in a fix by the cabal. Just give it up, you're losers.

Slot machine, bitchez.

(commence with junking, I will be having a wire sent to me this afternoon with your money goin in my pocket. Thanks evil market manipulators, I laugh last.

Wed, 02/20/2013 - 12:32 | 3259731 TruthInSunshine
TruthInSunshine's picture

02-20 11:12: Market talk of a commodity fund in trouble - Unconfirmed

 

That "unconfirmed" market talk, increase/decrease of dividend payouts, mega-mergers (and rumors of such), and all things associated with upside AND downside moves (and bubbles & busts) - in the "efficient markets."

Gotta' watch out for those things when gambling in rigged casinos....I mean investing in "efficient markets" -- even though it's not possible unless you're an as-yet-to-be-indicted person with the initials SC.

Wed, 02/20/2013 - 12:39 | 3259777 seek
seek's picture

MFG 2.0

I guess we'll know who the Chinese (or whoever that is standing for delivery) are using for their trades soon enough.

Wed, 02/20/2013 - 13:21 | 3259967 Canadian Dirtlump
Canadian Dirtlump's picture

I took greg mannarino's recent advice and backed the tank up on crude, and the truck up on gold and silver. Fast forward to this week.

 

Now I have tire tracks across my back and am bleeding from the ass!

Wed, 02/20/2013 - 14:12 | 3260266 strannick
strannick's picture

only if you believe these prices reflect reality. When Ags over a hun, whats a couple of bucks between friends?

Wed, 02/20/2013 - 13:44 | 3260111 Lewshine
Lewshine's picture

If you have to ask WHY or WHO...You lend credibility to the market, where there is none. Here's what happen - and what continues to happen, everyday; The top brass in the Bernanke put sent out the memo that today was the day to get short crude. Ben's tyrannical thieves set up the trade, pushed the button on absolutely NO fundamental news - and, BAM...Millions are made. They control EVERY asset class, today was just oil's turn. Its fake, fraudulent...NOT REAL! Nothing goes down without OK, everything goes up UNLESS it jeopardizes everything going up - Like precious metals. P Metals are a threat to the equity parabol - KILL THE THREAT! Oil is a result of printing and must be MANUFACTURED LOWER or it becomes a threat to equity parabol (which is the only thing keeping the window painted) - fawk guys this isn't rocket science. WHAT DOES BEN NEED? Answering this question while placing your bets takes you to the ultimate return. ZH never mentions this, or at least the entire point - Ben gets what Ben needs, and when he doesn't he just lies about the result, that, 9 times out of 10 creates the ideal anyway! The Fed owns the entire US market - every asset class, and they carve out everything needed. If their hands are not pushing an asset one way or the other - its only because that particular asset class doesn't matter at that moment. Hearing frickin retards saying "The Market", as if this thing has its own life, and moves on its own accord is the most ridiculous thing anyone could think. If this market was left to its own devices, Ben would be hanging naked from a light pole in front of the Fed building.

Wed, 02/20/2013 - 19:36 | 3261555 notquantumdum
notquantumdum's picture

I'm not sure I buy this.  There is another much simpler explanation short of a conspiracy:  it's the technicals, stupid.

Not too many hours after I awoke this morning, I noticed that BNO (ETF for brent north sea spot price) had failed to stay above what I considered to be an important very short-term technical support level of about $87.50.  Because of that fact, alone, I promptly sold all of my BNO at just about the beginning of the big route in oil prices today, locking in a nice profit from being long BNO for a number of months, even though I could have sold even higher.  This is just about when all of the big selling occurred -- or just before.  The price closed even lower.

Imagine that.

And, I'm not even part of the Bernanke syndicate and don't have any machine algos running (outside of my head).

Technicals typically work well in the short to very short terms.  We'll see about longer time frames.  I noticed exactly the same thing during the very beginning of the flash crash back in May of 2010 and numerous other times since then, also locking short-term and slightly longer-term gains both to the downsides and upsides at different times in different securities -- both riding the crashes down and then reversing to riding back up again after new resistance levels were breeched to the upside (making these same levels new support levels).

Is it impossible to believe that there are large quantities of much more sophisticated (and wealthier) traders who have automated such behavior with algos?  I certainly don't have any problem believing that is going on.  That would explain a lot.  It happens to both the upside and downside in prices whenever certain levels are crossed in just about every security I look at.

It's not a very hard way to make money, providing value to the people who will turn out to be on the losing side of the trade (by improving their price for them by taking the other side of the trade), if you know how to play the game well.

That being said, it does not prove that the Fed is NOT manipulating everything else besides the dollar value which they obviously do manipulate as part of their mandate.

Maybe they even watch the technicals too.

Mon, 03/04/2013 - 21:09 | 3299537 notquantumdum
notquantumdum's picture

Hmm . . . 'Wondered today if I should've bought BNO back only a few weeks later, saving at least 4.6%, net??

What is that, a 70% savings per year, on an annualized basis?

Is the short term over yet?

Mon, 03/04/2013 - 21:21 | 3299560 notquantumdum
notquantumdum's picture

Does this mean, responding to the original post in this thread, way back:

I am the market and therfore don't ask who, but rather, participate -- at least in part?

But, doesn't that mean there actually is a market again -- at least in part?

Tue, 03/05/2013 - 21:34 | 3303199 notquantumdum
notquantumdum's picture

if not unbelievably small part . . .

Tue, 03/05/2013 - 18:26 | 3302503 notquantumdum
notquantumdum's picture

What do you know?  BNO up today.  It looks like technicals worked again.

Tue, 03/05/2013 - 20:37 | 3302984 notquantumdum
notquantumdum's picture

I suggest that we do not have to be muppets.

We merely submit to such servitude, through ignorance.

Wed, 02/20/2013 - 12:21 | 3259678 prains
prains's picture

Allison Redford please pick up the red phone.....emergency emergency

Wed, 02/20/2013 - 12:41 | 3259785 MillionDollarBoner_
MillionDollarBoner_'s picture

Gary Gensler please pick up the red phone...emergency emergency

You corrupt, dickless, no-nuts douchebag!

Wed, 02/20/2013 - 13:15 | 3259931 venturen
venturen's picture

Does Gensler have to call Goldman for the excuse du jour?

Wed, 02/20/2013 - 13:26 | 3259993 Canadian Dirtlump
Canadian Dirtlump's picture

that burly cunt can eat shit and bark at the moon.

Wed, 02/20/2013 - 13:57 | 3260184 Mark Carney
Mark Carney's picture

Woof Woof

 

As an Albertan, there is going to be some huge pain from Govt in March.........

Wed, 02/20/2013 - 14:13 | 3260269 Canadian Dirtlump
Canadian Dirtlump's picture

Indeed. Thanks to all the big city sycophants who voted the fucks back in too. I'm from alboita too. The town I lived in during the last elections voted wild rose.

Wed, 02/20/2013 - 14:20 | 3260313 Mark Carney
Mark Carney's picture

Frankly, it woud not have mattered who is running.  In the end they all would assume $100/brl, even though CWS is growing rapidly in its spread to WTI.

 

Add in the fact that the Teachers and Nurses bitch and complain thet they  make little $, yet are paid more than a 20% premium to their national peers (fucktards).  And in govt office there is 1 manager per 4 employees where norm is 25:1.  Money well spent.  Look for major cuts to Alberta Health Service (maybe end of superboard) and all technology, education related funding.

 

With employment so low here, I am still having a hard time trying to grow my career in a new position..... stagnation, yay

Wed, 02/20/2013 - 12:22 | 3259686 Cognitive Dissonance
Cognitive Dissonance's picture

Things are rapidly becoming manic out there.

<Now where did I put that Faraday cage?>

Wed, 02/20/2013 - 12:22 | 3259687 MFLTucson
MFLTucson's picture

Another manipulated fraud.

Wed, 02/20/2013 - 12:22 | 3259690 slaughterer
slaughterer's picture

The real issue today is what happens in the commodity space at 2pm with the Fed minutes?  There is rumor of a slightly more hawkish tone, with talk of "costs" of QE.  This would be enough to scare a few over-leveraged commodity funds out of already plunging assets.    

Wed, 02/20/2013 - 12:24 | 3259697 EscapeKey
EscapeKey's picture

ooh, I can't wait for this weeks empty rhetoric

Wed, 02/20/2013 - 12:45 | 3259807 nope-1004
nope-1004's picture

Ya, maybe they'll mention that they are planning on withdrawing QE and raising rates.  LMAO !!

It's all bullshit, with Bernocchio being head bullshitter.

 

Wed, 02/20/2013 - 12:27 | 3259719 fonzannoon
fonzannoon's picture

It does seem very feasable that they will wind down QE relatively soon and very calmly start nudging rates upward to try to tap the brakes and keep us from overheating. We want to keep this moderate pace of expansion and not get too ahead of ourselves. I do look forward to being able to buy some bonds with higher coupons to go along with some stocks that I feel will benefit from the global economic recovery. I think the fed minutes will reassure me they are on the same page as I am,

 - fucking sheep

Wed, 02/20/2013 - 14:17 | 3260300 Captain Benny
Captain Benny's picture

The engine isn't heating up because its running well, its heating up because Keynesian Lube isn't oil, its more like melted slurpee.  It tastes good when its fresh, but after the sun gets to it... only the ants will dive in.

The engine's friction is quickly getting hot, but thats because the engine is litterally melting itself trying to put out more RPMs than the keynesian lube allows for.

Wed, 02/20/2013 - 12:32 | 3259736 greyghost
greyghost's picture

and again we will await the zero hedge report on any front running of the fed minutes!!!!

Wed, 02/20/2013 - 12:45 | 3259805 rogeliokh
rogeliokh's picture

"hawkish tone" About what?  Automatic Spending cuts on March 1 will cut GDP by 0.6-0.8%, Cut 500-700k Jobs

And Push Unimployment rate above 8%.. Is that recovery you are talking about?

Wed, 02/20/2013 - 13:30 | 3260021 Againstthelie
Againstthelie's picture

Your thoughts are too complex and well founded for the algo-driven and FED-initiated markets.

The crisis is solved, nothing to see here, go on!

Wed, 02/20/2013 - 13:30 | 3260023 CrashisOptimistic
CrashisOptimistic's picture

Hell, guy, that's just the Sequester.  That's from 2011.

We then have the end of March Continuing Resolution and the spending cuts that will be put into that.

Wed, 02/20/2013 - 12:23 | 3259693 EscapeKey
EscapeKey's picture

I group all my large trades together. By plunging the price, I get the best price possible (for other traders).

Wed, 02/20/2013 - 12:24 | 3259698 spastic_colon
spastic_colon's picture

apparently just part of the great rotation out of everything and into global equities /s

 

today's poster child for the DOW levitation is - IBM

Wed, 02/20/2013 - 13:04 | 3259884 scatterbrains
scatterbrains's picture

Dont forget XOM with IBM... they trade near identical  intraday on days when the NY Fed is fighting downside action.

Wed, 02/20/2013 - 12:24 | 3259703 SelfGov
SelfGov's picture

The bumpiest plateau!

Wed, 02/20/2013 - 12:24 | 3259705 bidaskspread
bidaskspread's picture

RBOB is down more, large speculation on that future position according to the commitments of traders report issued Friday.

Wed, 02/20/2013 - 12:24 | 3259708 LawsofPhysics
LawsofPhysics's picture

So it would appear that only a select few are being allowed to "buy the dip" or front run.  When fraud becomes the status quo, possession becomes the law. Now where did I park that tanker of concentrated calories?

Without calories, nobody is getting anything done in the real world, period.

Wed, 02/20/2013 - 12:26 | 3259714 JJSF
JJSF's picture

Same with gold and silver..

Paul Coghlan is doing a live charting webinar today at 1pm EST covering all this..should be good..always is.

  https://www1.gotomeeting.com/register/662247945
Wed, 02/20/2013 - 12:26 | 3259715 Boston
Boston's picture

Dr. Copper is falling to major trendline/support at around 3.55

If this breaks, then look out below......perhaps due to a global production slowdown finally getting priced in.

 

Wed, 02/20/2013 - 12:53 | 3259840 tecno242
tecno242's picture

Its not just copper..

look at a long term chart of gold and tell me what you think happens below 1500. 

commodities are set up for a crash... although I have no clue why. 

Either the FED is somehow behind this (which would require a massive amount of intervention)... or they are on red alert watching it.

Wed, 02/20/2013 - 13:51 | 3260155 Non Passaran
Non Passaran's picture

Perhaps a sign from the WH that more spending is needed to the "recovery " going?

Wed, 02/20/2013 - 14:28 | 3260346 Steaming_Wookie_Doo
Steaming_Wookie_Doo's picture

I'm waiting for some "scientific news" where they've learned to mfg gold for a fraction of the mining price. The hammering would be epic.

But seriously, there's something really weird going on when Russia, China and India are importing record amounts of gold, yet the prices are declining. We may have:

1. The mfg of gold thru fraud (tungsten core gold bars)

2. There's a lot more gold out there than is "officially" recognized

3. Existing stores of gold are being looted to fulfill these demands (at suppressed prices)

4. There is a method of mfg or extracting gold that is much cheaper/faster than previously known

Wed, 02/20/2013 - 12:26 | 3259716 FunkyOldGeezer
FunkyOldGeezer's picture

Goody, Goody...cheaper petrol pump prices soon. Yeah, right!

Wed, 02/20/2013 - 12:38 | 3259769 otto skorzeny
otto skorzeny's picture

I'm expecting $.50 off this morning's price at the pump when I drive by this evening

Wed, 02/20/2013 - 12:29 | 3259724 swissaustrian
swissaustrian's picture

Short covering in silver has started. More than 30000 contracts covered within minutes.

Wed, 02/20/2013 - 13:04 | 3259824 JustObserving
JustObserving's picture

30000 contracts times 5000 oz is 150 million ounces.  All the silver bullion available in the world is 1000 million ounces.  So 15% of silver bullion in world traded in few minutes.

The miracle of paper silver.

Wed, 02/20/2013 - 15:00 | 3260514 web bot
web bot's picture

Absolutely brilliant observation. Futures market are a casino. They originally were create to hedge futures for "legitimate" purposes. Now they are just a casino. Bart Chilton has missed something big here - good old common sense.

Wed, 02/20/2013 - 12:30 | 3259728 adr
adr's picture

Don't worry they can just seasonaly adjust oil and gas consumption to make it look like Americans used more gasoline in Febraury than the entire year of 2012. That should be enough to hit Goldman's $150 target.

Wed, 02/20/2013 - 12:40 | 3259784 spastic_colon
spastic_colon's picture

yes...they needed something to show that retail sales continue to rise

Wed, 02/20/2013 - 12:34 | 3259750 orangegeek
orangegeek's picture

Looks like wave 2 up is complete.  Wave 3 down appears underway.

 

http://bullandbearmash.com/chart/wti-oil-daily-falls-sharply-completing-...

 

Signs of topping occured in January.

Wed, 02/20/2013 - 12:42 | 3259792 El Hosel
El Hosel's picture

...... Signs of topping have been occuring for three years! Better late than never.

Wed, 02/20/2013 - 12:37 | 3259753 ekm
ekm's picture

The real drop would be $5- $10 in one day. It's happened few times already.

 

Just wait......just wait.

 

This is the flowchart:

 

Crude oil price caps QE

Halt of QE caps stocks

 

It's quite possible that the dear leader in the WH has already signed the executive order to crap the market.

 

Equation:

Shortage of crude oil in the real economy = Starvation

Wed, 02/20/2013 - 12:41 | 3259790 Joe Davola
Joe Davola's picture

What would his wife do if there were no obesity to wage war against.  (Much like poverty and ray schism.)

Wed, 02/20/2013 - 12:35 | 3259759 Joe Davola
Joe Davola's picture

Surely this will be reflected at the pump toot sweet.

Wed, 02/20/2013 - 12:39 | 3259771 monopoly
monopoly's picture

Wow, love free markets.

 

Wed, 02/20/2013 - 12:39 | 3259772 Dr_Lucid
Dr_Lucid's picture

Anyone notice that the pace of selling today is picking up?  Its been a while since my entire screen was red.

Wed, 02/20/2013 - 12:58 | 3259861 rubearish10
rubearish10's picture

Red???

Wed, 02/20/2013 - 12:40 | 3259773 SillySalesmanQu...
SillySalesmanQuestion's picture

Oddly enough, the CME halted oil futures trading at the exact time the phone call was made to the Plunge Protection Team...Can't have any one of importance losing any money, or not make it to the Frontrunning Party...

Wed, 02/20/2013 - 12:39 | 3259774 SilverDOG
SilverDOG's picture

Fine by me.

Will wait a moment before I fill up with aviation fuel.

Wed, 02/20/2013 - 12:40 | 3259778 tecno242
tecno242's picture

Something is up in commodity land....  or should I say... something is going down in commodity land...

intervention or are investors really beginning to believe the end of the fiat game is coming?

long term gold chart looks crashish below 1500...

Wed, 02/20/2013 - 12:41 | 3259786 buzzsaw99
buzzsaw99's picture

Margin call gentlemen...

Wed, 02/20/2013 - 12:44 | 3259799 tecno242
tecno242's picture

traders of $250mm blocks of commodity futures don't get margin called

there is a clear bias in long term commodity charts that some sort of deflationary crash is possible

personally I don't know how that could happen as fast as the charts indicate... but it's there

Wed, 02/20/2013 - 13:24 | 3259981 WarHorse
WarHorse's picture

Are you saying that because the curve is backwarddated?  If so, that is the normal state of the forward curve for oil. 

Wed, 02/20/2013 - 12:41 | 3259789 ebworthen
ebworthen's picture

So they ramped it up so they could sell it; surprise, surprise.

Those robots have been busy rotating in and out of sectors, slaughtering muppets and "markets".

Wed, 02/20/2013 - 13:46 | 3260121 Non Passaran
Non Passaran's picture

I don't think they'd sell it that way if they were 4profit sellers

Wed, 02/20/2013 - 12:43 | 3259798 busted by the b...
busted by the bailout's picture

Recessions have consequences.

Wed, 02/20/2013 - 12:45 | 3259804 CheapBastard
CheapBastard's picture

Dog-gone speculators! Why isn't Pelosi in a rage?

Wed, 02/20/2013 - 12:45 | 3259809 Grand Supercycle
Grand Supercycle's picture

As mentioned, CRUDE daily chart bearish warning strengthens further.

http://trader618.com

Wed, 02/20/2013 - 12:47 | 3259816 Flakmeister
Flakmeister's picture

What about Brent? i.e. the real price of oil?

Oil priced in Euros is near all time highs....

Wed, 02/20/2013 - 13:03 | 3259886 ekm
ekm's picture

Precisely.

That's why Europe is going crap.

Wed, 02/20/2013 - 12:59 | 3259867 rufusbird
rufusbird's picture

Minsky moment...

Wed, 02/20/2013 - 13:12 | 3259913 SDRII
SDRII's picture

Meanwhile, that little Island dispute and NK nuke test is turning into a bonanza for the US:

Another Xband radar being deployed in Japan

&

Japan wants a US Shale Gas / LNG Deal (which the US will no doubt try and pry open the Japan Ag market circa TPP)

 

 

Wed, 02/20/2013 - 13:17 | 3259939 Herdee
Herdee's picture

Looks to me that the Spreaders were dumping everything they had into the U.S. Dollar Index today.Must have inside Washington direction on types spending cuts coming.

Wed, 02/20/2013 - 13:20 | 3259961 phalfa5
phalfa5's picture

SPOT on

Wed, 02/20/2013 - 13:19 | 3259957 John McCloy
John McCloy's picture

  We always see this before the next ramp. Ben cannot allow oil to go over 100 or for too long a period of time nor gold and it has been this way for 4 years.

Market rises, oil starts flying upward along with PMs.

Ben allows the markets to fall a little so he can disguise the exxagerated downticks in oil and PMs and then up we go once more without those pesky nuisances.

WTI was getting to big for its britches in the headlines again and that is the one thing that all the planners know tip off the consumers and distract from Honey Boo Skating with the Stars. It is not sustainable but he's gonna give it a go.

Wed, 02/20/2013 - 13:19 | 3259959 electricgorilla
electricgorilla's picture

Check this guys last last tweet on crude oil futures. While crude oil futures get hammered this guy seems to think everything is steady...sheesh

https://twitter.com/joiknow

Wed, 02/20/2013 - 13:42 | 3260096 Non Passaran
Non Passaran's picture

Such guys are plenny....
85-90% of all investors by now.

Wed, 02/20/2013 - 13:43 | 3260103 pcrs
pcrs's picture

fomc meeting leaked: hawkish?

Wed, 02/20/2013 - 14:33 | 3260375 Downtoolong
Downtoolong's picture

“two-second 2500 contract block' ~$250mm”

These are the only reasons I can think of that someone would enter an order this size this way.

1.    Intent to manipulate the market

2.    Insider trading

3.    Desperate seller getting squeezed

4.    That someone isn’t anyone, but a computer running on smart technology that turns out isn’t all that smart after all.

Take your pick. Anyone of them describes a broken market which dictates the price of oil and gas every day.

 

Wed, 02/20/2013 - 15:11 | 3260582 orangegeek
orangegeek's picture

WTI Oil was showing wave 2 end (top) in the last week of January.

 

http://bullandbearmash.com/chart/wti-oil-daily-falls-sharply-completing-...

 

WTI Oil should continue to fall.

Wed, 02/20/2013 - 21:20 | 3261834 WallowaMountainMan
WallowaMountainMan's picture

supply and demand....such an outdated concept.

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