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Stocks Dead-Cat Bounce But Credit Ain't Buying It

Tyler Durden's picture




 

UPDATE: As soon as cash markets closed, S&P futures dumped 6 points...

US (and Japanese) stocks began their dead-cat bounce around the European open tracking USDJPY (once again) and rising in reverse order of yesterday's selloff as Nikkei, Trannies, Nasdaq and so on (in order) recovered around 25-35% of yesterday's losses. For Fibonacci-watchers, S&P futures ticked 38.2% retracement and stalled and VWAP was support all day. Credit markets did not buy it and stocks caught down to them. Silver, having underperformed since the taper, outperformed today back over $19.50 and +1.7% on the week as gold slipped modestly today (but +0.8% on the week). Treasuries sold off modestly leaving yields -2-3bps on the week. AUD stength and JPY weakness supported stocks but the USD flatlined ahead of tomorrow's ECB meeting. MUB, the Muni ETF, was smashed lower on the Puero Rico junking (and that triggered a quick waterfall in stocks) but that was quickli BTFD'd. VIX fell an impressive 2.9 vols to 18.5%, which is notable since stocks 'underperformed' the hedge cover by a long way.

The S&P 500 remains below its 100DMA, The Dow closed below its 200DMA once again; and Trannies bounced off the 100DMA

 

The bounce in context... 38.2% in the S&P 500...

 

Credit markets acted as support as stocks kept bouncing back down to reality....

 

Trannies and Nasdaq inch back into the green post-Taper...

 

The bounce in stocks was all about USDJPY yet again...

 

Over the 2 days - stocks are still down markedly

 

Copper and Oil recovered to unch on the week as Silver outperformed on the day...

 

Treasuries sold off modestly but remain lower in yield on the week...

 

The USD looks flat (as EUR trod water ahead of tomorrow's ECB meeting) but the AUD and JPY move was impressive...

 

Charts: Bloomberg

Bonus Chart: When PR was downgraded, MUB (the Muni ETF) was hammered lower...

 

Bonus Bonus Chart: The Nikkei is roaring back relative to the Dow... for now...

 

 

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Tue, 02/04/2014 - 17:11 | 4401518 RockyRacoon
RockyRacoon's picture

AAAARGH!  Too many disconnects to make a prediction. 

But that's never stopped me before:  It's going all to shit.

Tue, 02/04/2014 - 17:14 | 4401534 Sudden Debt
Sudden Debt's picture

want some grass bro?Got some real californian green for ya!

Tue, 02/04/2014 - 17:27 | 4401603 negative rates
negative rates's picture

No, we got plenty of that, you can send some of those dry peaches with the magic bags though, they look like the real ga peach but you can't tell until you buy um. They always come back for more so perhaps you can turn a buck wit me that way.

Tue, 02/04/2014 - 17:29 | 4401616 So Close
So Close's picture

Since when has credit "bought" it?

Tue, 02/04/2014 - 17:30 | 4401617 So Close
So Close's picture

Since when has credit "bought" it?

Tue, 02/04/2014 - 20:27 | 4402135 asteroids
asteroids's picture

The credit men are always smarter. The "boyz" with their supercomputers and super fat accounts refused to let the market fall today. Only towards the end of the day did they move the market where they wanted it. Thanks to the chairsatan and 5 years of free money, the markets are now under the firm control of you know who.

Wed, 02/05/2014 - 14:41 | 4404644 Remington IV
Remington IV's picture

Yep , those bond geeks were so right in 2008 !?!?!?

Wed, 02/05/2014 - 14:41 | 4404645 Remington IV
Remington IV's picture

Yep , those bond geeks were so right in 2008 !?!?!?

Tue, 02/04/2014 - 17:09 | 4401519 Sudden Debt
Sudden Debt's picture

YEAH!!! the ecb will tell it how it is!!!

KEEPING IT REAL SINCE 2015!!!

Tue, 02/04/2014 - 17:11 | 4401523 Finnman
Finnman's picture

Yes, Draghi will tell to you.

Tue, 02/04/2014 - 17:09 | 4401520 Finnman
Finnman's picture

Investors are buying bargains. So next 2-3 weeks it's huge rally?

Tue, 02/04/2014 - 17:10 | 4401528 Sudden Debt
Sudden Debt's picture

DIPS MAN! DIPS!!!

Tue, 02/04/2014 - 17:11 | 4401531 Winston Churchill
Winston Churchill's picture

What part of dead cat bounce did you miss ?

The smart money left the building today.

Tue, 02/04/2014 - 17:13 | 4401541 Sudden Debt
Sudden Debt's picture

I KNEW THAT STRIPPER TOOK MY WALLET!!! BITCH!!!

Tue, 02/04/2014 - 17:18 | 4401557 Debeachesand Je...
Debeachesand Jerseyshores's picture

They were just seen leaving the building behind the previous Chairman of the Federal Reserve.

Tue, 02/04/2014 - 19:19 | 4401926 new game
new game's picture

so if it left the building; a)did it go to a vault as shiney? b)money market/cash funds? c) lear jet purchase?

d) hookers and blow? e)emerging markets? f)real estate? g)art and fine cars? h)check out and prepping?i)bonds?j)stocks-btfd k)all of the above?

Tue, 02/04/2014 - 19:44 | 4402026 Winston Churchill
Winston Churchill's picture

If I knew for certain, I would front run it.

All I can guess is the market will be performing like a one legged

limbo dancer tomorrow.

ie: it will fall on its arse.

Tue, 02/04/2014 - 17:42 | 4401656 Ass. Manager
Ass. Manager's picture

"Just buy the fucking dip, you fucking idiot."

Tue, 02/04/2014 - 21:24 | 4402297 mumbo_jumbo
mumbo_jumbo's picture

LOL, that was a knee slapper......bargains.....LOL...that sounds SOOOOOO 1999

Tue, 02/04/2014 - 17:12 | 4401535 G.O.O.D
G.O.O.D's picture

Quit being a pussy, I'm all in on red.

Tue, 02/04/2014 - 17:16 | 4401552 Sudden Debt
Sudden Debt's picture

In 2008 we called it all "soft patches"... anybody remember those days?

Tue, 02/04/2014 - 17:18 | 4401558 G.O.O.D
G.O.O.D's picture

Greenspasm? Those days of “Irrational exuberance

Tue, 02/04/2014 - 17:18 | 4401559 HpDeskjet
HpDeskjet's picture

ECB = thursday not wednesday right?

Tue, 02/04/2014 - 17:18 | 4401576 HyBrasilian
HyBrasilian's picture

Credit... CREDIT?... CREDIT?

 

Whoever THEY are... I guess they're not buying it...

Tue, 02/04/2014 - 17:20 | 4401583 Dr. Venkman
Dr. Venkman's picture

Something broke.

Tue, 02/04/2014 - 17:33 | 4401628 HyBrasilian
HyBrasilian's picture

It's TRUE... This man has NO CREDIT

 

[Well that's what I heard!]

Tue, 02/04/2014 - 17:48 | 4401676 NOTaREALmerican
NOTaREALmerican's picture

Good Credit, Problem Credit,
No Credit...
No Problem!

Arrange your next loan with us. Our online questionnaire takes only minutes to complete and loan decisions normally occur within hours.

Tue, 02/04/2014 - 17:25 | 4401598 alexander-delarge
alexander-delarge's picture

What index / instrument does TD/ZH use to follow / chart 'credit' ?  Thanks,  AD

Tue, 02/04/2014 - 17:24 | 4401604 OwnSilverPlayMusic
OwnSilverPlayMusic's picture

Eh, I got nothing to add.  So here's a killer track to listen to.  Fela Kuti- "Zombie" http://www.youtube.com/watch?v=Q76UngzHX5Y

Tue, 02/04/2014 - 17:31 | 4401627 ghostzapper
ghostzapper's picture

Not a good day for the intoxicated by Hopium cheerleaders.  lower volume bounce that had minimal ooomph behind it.  1760 not a key level but relevant and couldn't even touch much less try to penetrate it.  Not much between here and 1646ish.

So, who blinks first the Fed or the ECB?

Bonus Question:  what's the new acronym for the latest and greatest scam they announce?   

Tue, 02/04/2014 - 18:40 | 4401837 duncecap rack
duncecap rack's picture

No Eeyore(IOER)

Tue, 02/04/2014 - 17:35 | 4401639 adr
adr's picture

SO there are no real reasons based on actual commerce for stocks to trade the way they do. A bounce happens because a bounce should happen, and it happens to be a near perfect Fibonacci retracement because a retracement should be a perfect Fibonacci retracement.

Why can't we just map the market for the next year and build a perfect chart with 20% corrections followed by rallies that take the market up 50%. The stock market can be like the WWF, totally scripted with fake drama. Companies like Netflix can have a planned surprise miss that takes the stock down by 20% in a day only to see it shoot right back up, what a story that makes. CNBC can still exist, they wouldn't even have to change formats since 99% of what they say is scripted.

Then everyone can make money and everyone can be rich. Just think of the GDP growth. Like the new Bitcoin millionaires, everyone will get the itch to spend that unearned cash.

Tue, 02/04/2014 - 17:44 | 4401664 NOTaREALmerican
NOTaREALmerican's picture

Re:  A bounce happens because a bounce should happen, and it happens to be a near perfect Fibonacci retracement because a retracement should be a perfect Fibonacci retracement.

I'm still plotting the head-n-shoulders pattern starting with the last Napolianic war.    Fibonacci sounds Italian, there can't be any predictive powers in that.   

Tue, 02/04/2014 - 17:59 | 4401710 JaKst3r
JaKst3r's picture

Fibonacci sounds Italian.. Buy Italian stocks immediately.....

Tue, 02/04/2014 - 19:19 | 4401928 DrunkenMonkey
DrunkenMonkey's picture

Uh-oh, if people are finding their sense of humour on ZeroHedge, that is the ultimate market indicator ..

Wed, 02/05/2014 - 04:59 | 4403129 williamson
williamson's picture

Australian listen.

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