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Behold The Trading Avalanche Unleashed By The Chicago PMI Headline

Tyler Durden's picture




 

As most know, the whopping beat of a Chicago PMI (remember: Chicago is located about a 100 miles from Milwaukee, whose PMI today crashed from 48.43 to 40.67 - what a difference a "legitimate" city makes) print that was made public at 9:45 am was first released to subscribers - read HFT trading firms - some three minutes earlier. As an aside, putting the number in other regional Fed and PMI context, here it is via John Lohman:

What most may not know is just how massive the pent up deluge of trades was behind this number. Courtesy of Nanex we know. Because during just 1 second of time at 9:42:00, the following trade counts were recorded:

  •     550,000 SPY shares
  •     10,000 June 2013 eMini futures contracts
  •     1,400 Nasdaq 100 futures contracts
  •     800 Dow Jones futures contracts
  •     350 Russell 2000 futures contracts
  •     125 S&P 400 Midcap futures contracts
  •     300 Crude Oil futures contracts
  •     900 Dollar Index futures contracts
  •     800 Gold futures contracts
  •     10,000 10yr T-Note futures contracts
  •     2,500 5yr T-Note futures contracts
  •     3,500 T-Bond futures contracts
  •     5,000 Eurodollar futures contracts
  •     750 Japanese Yen futures contracts
  •     600 Euro futures contracts

Yup: it's nothing more than a headline driven market with the only variable whether or not a number is > or < than "expected."

Which is the same as the trading response when the April retail spending data hit two weeks ago, and which was just revised from a massive beat to a miss. Alas, algos aren't programmed to sell on disappointing data revisions: only to buy on beats (and in the New Normal - misses).

Visually all of the above via Nanex:

June 2013 eMini Futures Depth of Book

 

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Fri, 05/31/2013 - 11:04 | 3613613 malikai
malikai's picture

Not all algos are that dumb.

Anyway, S&P looks about as wound up as a whore in communion.

Fri, 05/31/2013 - 11:14 | 3613653 walküre
walküre's picture

What exactly are the managers "purchasing" to get this data print?

That's a huge jump. Is anyone out there even insterested in asking the question?

Hookers and blow, couple Lambos and so on they're buying from the profits of their corporate stock buy backs don't count.

This is pretty significant. What are they buying and what are they expanding into?

Nothing an nowhere of course. It's all bullshit! But it suits the narrative. Fed wants to taper and needs the bullshit recovery as background to justify the next step. Time for an exit.

Exit Weimerica while you can.

Fri, 05/31/2013 - 11:21 | 3613679 surf0766
surf0766's picture

Asking question gets you a visit from the IRS.

Fri, 05/31/2013 - 11:48 | 3613757 NotApplicable
NotApplicable's picture

Five Golden Rings!

Fri, 05/31/2013 - 12:25 | 3613891 Raymond K Hessel
Raymond K Hessel's picture

ALGO FUCK YOURSELF!!

Fri, 05/31/2013 - 15:18 | 3614686 Cult of PersonALity
Cult of PersonALity's picture

ALGO  short for Al Gore , inventor of the internet, and ALGOre-rithmic trading... 

Fri, 05/31/2013 - 11:23 | 3613685 CrashisOptimistic
CrashisOptimistic's picture

The Fed absolutely does not want to exit.  How can they want to exit with Q1 GDP at 2.4% amid all the stimulus, bouncing from Q4's 0.4%, and projected Q2 at 1.5%?  How do you declare success at 1.5%, and ramp rates on 17 Trillion in debt?

The declaration that the deficit will fall and there won't be enough bonds to buy is based on the 1 time influx from Fannie/Freddie.  With GDP south of 2%, tax revs won't hit targets defined by the tax increase.  The deficit will be at about 700+B this year and 800+B next year.  That's only a 200B differential the current level of QE would have to find in existing inventory, the sellers of which may be reluctant, raising prices (which cuts yield).

 

 

 

Fri, 05/31/2013 - 13:29 | 3614097 walküre
walküre's picture

You're making too much sense. Ben said last year sometime that "depositors" would like to see higher returns on their deposits. He wasn't talking J6P depositors. He was talking about the big boyz. See, the big boyz have offloaded the crap from their balance sheets onto the taxpayer. Now they're looking stellar and have money to burn. No wait, they're not burning any money because they know to invest into a flailing and receeding economy would be stupid. But they have all this money and they want more yield. They got the cake and now they want to eat it. Come hell or high water I suspect and we will all have to chip in more to the taxman so that the big boyz can earn more interest on the money that they were gifted when their own houses were burning, crashing and falling.

Is deflation in the cards or not? Technically they can't deflate but technically we're broke and technically there's no recovery and yet we're told they have it under control and America's best times are still ahead.

I think only a proper revolution can solve this problem and set the record straight. When the East Germans overthrew their government, the people stormed into the offices of the secret service and so on and found out what was really going on. Suggest we do the same and copy the process. I want to see corrupt politicians taking the stand and being tried for their lies and theft. Then I want to see the banker class being tried for theft and manipulation. Lastly we're getting to the propagandists who have helped establishing the lies and spreading false information. Lawyers don't even need to show up. They'll be shot on sight.

End of story.

Fri, 05/31/2013 - 11:29 | 3613706 Variance Doc
Variance Doc's picture

"Weimerica" ... love it!

Fri, 05/31/2013 - 13:04 | 3614008 Iam_Silverman
Iam_Silverman's picture

"What exactly are the managers "purchasing" to get this data print?"

 

Hey, this is Chicago, right?  They are buying "insurance" and "protection" from the Mayor and City Councilmen, no doubt!

Fri, 05/31/2013 - 11:14 | 3613654 max2205
max2205's picture

A Perfectly functioning Market....Oh wait....

Fri, 05/31/2013 - 11:05 | 3613619 ParkAveFlasher
ParkAveFlasher's picture

Sell!!! no no no wait, Buy!!!

Fri, 05/31/2013 - 11:21 | 3613680 TheFourthStooge-ing
TheFourthStooge-ing's picture

.

Sell!!! no no no wait, Buy!!!

No, no, hold on, Bell!!!

Ooops, wait, no, just a sec, Splunge!!!

Fri, 05/31/2013 - 11:05 | 3613622 icanhasbailout
icanhasbailout's picture

I am about to unleash an IPO my new public company for women who deserve only the best. I'm calling it "Miss Expectations".

Fri, 05/31/2013 - 11:07 | 3613627 Zen Bernanke
Zen Bernanke's picture

I wish I owned a clearing house.

Fri, 05/31/2013 - 11:40 | 3613740 Bananamerican
Bananamerican's picture

i wish i owned America- a citizen

Fri, 05/31/2013 - 13:06 | 3614018 Iam_Silverman
Iam_Silverman's picture

"i wish i owned America"

In that case, get behind the Chinese in line to purchase Treasuries!

I really think your money would be better spent "lobbying".  It's probably cheaper to buy a handful of politicians than America anyway.

Fri, 05/31/2013 - 11:08 | 3613629 Motorhead
Motorhead's picture

When will you people learn?  If you have no expectations, then you can't be disappointed.  Of course, I have no expectations of my wife getting me another beer right now, so excuse me for a moment....

Fri, 05/31/2013 - 11:08 | 3613630 caimen garou
caimen garou's picture

bullshit driven market by this bullshit administration!

Fri, 05/31/2013 - 11:23 | 3613690 Everybodys All ...
Fri, 05/31/2013 - 11:11 | 3613642 MFLTucson
MFLTucson's picture

Cicero wrote:

"The Jews belong to a dark and repulsive force. One knows how numerous this clique is, how they stick together and what power they exercise through their unions. They are a nation of rascals and deceivers."

Fri, 05/31/2013 - 11:20 | 3613672 robochess
robochess's picture

Oh, and NO other race in the world sticks together I suppose. Not blacks, hispanics, asians, ... actually only caucasians don't have a clue about sticking together.

Fri, 05/31/2013 - 11:25 | 3613698 jbvtme
jbvtme's picture

those other races are not intent on enslaving and destroying the planet

Fri, 05/31/2013 - 11:40 | 3613736 akarc
akarc's picture

yeah shame on all them Jews that came to America massacred the natives stole there land and the went to africa and stole there people and brought them back here to force them to work the land they stole..................

Facists love it when you focus on other people to hate rather than the real enemy. Thats how the real enemy gains and keeps control. Throw another log on the fires of stupidity and ignorance boys, cause it still works, just like in the old days. 

 

 

Fri, 05/31/2013 - 11:41 | 3613744 icanhasbailout
icanhasbailout's picture

Amen. I would have figured that here of all places people were smart enough not to fall for the old-as-dirt "Us vs. Them" tactics.

 

Guess that's why they still use it - it works, even on people who really really really really ought to know better than to chew on sucker's bait.

Fri, 05/31/2013 - 18:55 | 3615467 Tompooz
Tompooz's picture

You haven't seen it all when it comes to "us vs. them" . The new division being set up is "generationalism", baby boomers as scapegoat vs. the young unemployed.   While feminism, the division between the sexes, is still as rampant as the newly engineered  Sunni-Shi'a hatred in the Middle East.

Prepare to be ruled!

Fri, 05/31/2013 - 11:55 | 3613782 Randall Cabot
Randall Cabot's picture

Actually, the black slave trade was dominated by jews. And the jews bought the black slaves from other blacks.

Fri, 05/31/2013 - 12:16 | 3613859 akarc
akarc's picture

And who lined up to buy the black commodity and fought against abolishing slavery during the formation of the constitution????

Russia and the Gulaq, Argentina and missing generations, America and dark prisons, Mao and China........... all cause of them damn jews. Yepper, dats what dey taught me in dat dere Bubba school, beware dem nasty ol jews cause they ain't afraid and can fight like a sumbitch while the American working class take it up ass w/o KY.

How many cops of northern european ethnic background upheld your constitutional rights lately?

Their to busy extolling the virtues of a failing D.A.R.E. program so they can get more money to fight street gangs (they had to take the focus off drugs cause that wasn't workin out to well) and buy super cars by which to track your ass.

Or do you get out in the real streets much?

 

 

 

 

Fri, 05/31/2013 - 12:29 | 3613902 DizzySailor
DizzySailor's picture

Fuck You AssHole.......

 

I am not some serious devout christian, but for all ot those who have suffered under the edict "It's only business" may you and all your kin rot in the 9th ring.

Fri, 05/31/2013 - 12:36 | 3613921 akarc
akarc's picture

"I am not some serious devout christian,"

Obviously. 

"Fuck You AssHole......."

Why sir, you flatter me.


Fri, 05/31/2013 - 11:32 | 3613719 THX 1178
THX 1178's picture

I wouldnt call Jewish a race. Most of them are white. They are a culture/religion to me.

Fri, 05/31/2013 - 11:12 | 3613644 screw face
screw face's picture

It's the fricken' machines, they are writing the news and making the trades.

 

 

...give thanks for the additional CP...

Fri, 05/31/2013 - 11:13 | 3613646 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

Bad was good, good was good, but now w/ a fade of weirdly good (Chicago PMI), good may no longer be so good. We'll have to see if it becomes bad. Maybe by the end of the day, it will have been seen as good ...

Market needs a correction to retain the last shreds of legitimacy. If it is true that smarties are getting out, these "shreds" will come apart some time this summer.

Bond vol is whopping, Japan vol is whopping, commodity vol whopping. Next on the list? This question is not rocket science.

Fri, 05/31/2013 - 11:50 | 3613766 Seer
Seer's picture

Sometimes when you win, you really lose, and sometimes when you lose, you really win, and sometimes when you win or lose, you actually tie, and sometimes when you tie, you actually win or lose. Winning or losing is all one organic mechanism, from which one extracts what one needs.

- Gloria Clemente (Rosie Perez [wow!]), White Men Can't Jump

 

 

Fri, 05/31/2013 - 11:15 | 3613656 Kreditanstalt
Kreditanstalt's picture

This isn't a "trading avalanche"...it's a BETTING avalanche.

Nothing is changing hands here, nothing is being produced...

 

Fri, 05/31/2013 - 11:21 | 3613676 LawsofPhysics
LawsofPhysics's picture

"Nothing is changing hands here, nothing is being produced..."

That's how the financial sector and financial "products" work.  Now about all those fees...

Roll the god damn guillotines already...

Fri, 05/31/2013 - 11:30 | 3613709 akarc
akarc's picture

Money is changing hands, wealth inequality is being produced resultant in a totalitarian kleptocracy that took over America without firing a shot.

Told my gun owning friends (I was a gun owner till I tipped my canoe) not to worry about gun bans. Would not happen. Government knows public has no balls. Otherwise we wouldn't be where we are.

Now private ownership of missle bearing drones............. thats another story.

 

 

Fri, 05/31/2013 - 11:40 | 3613741 LawsofPhysics
LawsofPhysics's picture

Maybe.  However, shut off the bread in the "bread and circuses" and let's find out...

Fri, 05/31/2013 - 11:53 | 3613774 akarc
akarc's picture

THe people will turn on themselves. Robbing and killing each other. Banks, corporate offices, government officials, gated communities will be guarded by well trained mercenaries and U.S. soldiers who will haven no problems selling their souls for the oppourtunitty to eat steak and rape and plunder.

See if you can count the numbers  of individuals who have sworn to uphold the U.S. constitution and then count the nummber that have actually read it.

Witness Kent Ohio. Witness Occupy. Witness the civil rights movement.

 

Fri, 05/31/2013 - 11:59 | 3613801 LawsofPhysics
LawsofPhysics's picture

Bullshit, maybe for cowards.  Black markets will take over long before that (witness India, Mexico, Afghanistan, Pakistan etc.)  ALL economies are local, history is very clear on this.  I am part of a large farming Co-op.  We have a plan.  I see many who have "promised" to uphold the constitution while the actions have been the exact opposite.  Chance always favors the prepared, history is very clear on that as that which cannot be sustained, won't be.  No "gated community" in or around a major city will survive shit.

Fri, 05/31/2013 - 12:30 | 3613905 akarc
akarc's picture

Black markets already have. They call em flea markets, yard sales, random set ups in the empty parking lots of closed businesses, craigs list..........want a good deal from on some motorcycle tires?

Cowards? Witness New York city with enough cameras to watch you take a leak if you don't close the cutains because we traded liberty for security.

You are correct however, chance does favor the prepared and if you think the people who have the wealth that runs this country aren't prepared to:

A. Tax your coop to death

B. Just freaking take it

Then you are the one unprepared.

 

 

Fri, 05/31/2013 - 11:17 | 3613661 robochess
robochess's picture

what time does POMO action typically end? Isn't at 11:00a.m. ET?

 

Fri, 05/31/2013 - 13:10 | 3614027 Iam_Silverman
Iam_Silverman's picture

"what time does POMO action typically end? "

Never.  It only "tapers".

Fri, 05/31/2013 - 11:17 | 3613662 PontifexMaximus
PontifexMaximus's picture

Month end

Fri, 05/31/2013 - 11:19 | 3613667 LawsofPhysics
LawsofPhysics's picture

All good until those political puppets need to fund their budget/deficets;

http://www.marketwatch.com/investing/bond/10_year

 

End of the month ramp or has the next "lehman" been decided?  Thoughts...

Fri, 05/31/2013 - 11:27 | 3613701 eclectic syncretist
eclectic syncretist's picture

I think if the ten year bond gets to even just 5-6% at this point it's game over for the system.  Don't see it happening though, as I believe a lot of money would jump in just to get 4% at this point.

Fri, 05/31/2013 - 11:23 | 3613688 eclectic syncretist
eclectic syncretist's picture

What do you expect when everything is based on frontrunning a fraud?

Fri, 05/31/2013 - 11:29 | 3613693 Seasmoke
Seasmoke's picture

Bad < Badder < Baddest.

Fri, 05/31/2013 - 11:25 | 3613695 jimijon
jimijon's picture

Looks like one of my sound tracks in reason.

Fri, 05/31/2013 - 11:25 | 3613696 geotrader
geotrader's picture

Common (algo) sense => Bullish!

Fri, 05/31/2013 - 11:26 | 3613700 swmnguy
swmnguy's picture

It's like walking into the Sports Book at Caesar's Palace three minutes before Super Bowl kickoff and yelling, "Tom Brady has a backache!"  And equally relevant.

Fri, 05/31/2013 - 11:57 | 3613791 DeadFred
DeadFred's picture

This stuff used to have more legs but it gets faded real fast now. The top is in. They know it. We know it. Someday soon the sheeple will know it.

Fri, 05/31/2013 - 12:02 | 3613809 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

Bernanke must have proclaimed unleash the HFT Kraken this morning.

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