What Changed At 1035ET?

Tyler Durden's picture


Just as we saw yesterday, US equities have decoupled from FX carry but not long after POMO started something very odd happened... at 1035ET, shorts started piling on...



So what happens next? Manufacture a short squeeze which lifts the S&P 500 to unchanged for 2014 (aroun 0.75% higher from here) or so the indices catch down to FX carry weakness?

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Fri, 02/14/2014 - 13:34 | 4436818 Dear Infinity
Fri, 02/14/2014 - 13:45 | 4436854 flacon
flacon's picture

Did anyone else catch the craziness at 9:50am on SPY? Massive volume up and down, then down and up and down in a few seconds. It was like an earthquake. 

Fri, 02/14/2014 - 13:58 | 4436891 Its Only Rock N Roll
Its Only Rock N Roll's picture

There was a delay in trade reporting for 20 mins.  I am sure CNBS covered this.....

Or were they too busy talking about the ripping rally to notice.


Fri, 02/14/2014 - 16:00 | 4437380 The Juggernaut
The Juggernaut's picture

GS is opening the door for the muppets to come in.

Fri, 02/14/2014 - 14:03 | 4436912 asteroids
asteroids's picture

Nothing but computers today folks. The snow is keeping people home. For the market to go down, there have to be sellers and adults in the room. As far as I can tell they didn't go into work yesterday and today, therefore, no selling. BUT.... come Tues. it's going to be very interesting.

Fri, 02/14/2014 - 14:19 | 4436992 NotApplicable
NotApplicable's picture

I'm guessing it was the Automated Windows Updates.

Those fuckers reboot at the most inappropriate times...

Fri, 02/14/2014 - 16:46 | 4437418 Frank -THE COIN -
Frank -THE COIN -'s picture

I saw it. It was Crazy ! it made me think we were about to have another day like back in August 2007 when the SPY etc was printing 200 points apart. At that time each print was 200 points apart like a broken Algo Machine. Today felt just like it, except back then it lasted hours, and took down a few Billion Dollar  Hedge Funds. That was really the start of the unravelling of 2008. It will be interesting to look back on today in the future.

Fri, 02/14/2014 - 13:46 | 4436856 BarnacleBill
BarnacleBill's picture

Certainly the time is getting near for a significant breakout. We need to be careful, though. In October 2012 I posted a piece called "How to buy gold" on my blogsite [Barlow's Cayman], that ended with this sentence: "... there is more risk in custody than in price, in these wicked days." I believe that warning is still valid.

Fri, 02/14/2014 - 13:51 | 4436876 greatbeard
greatbeard's picture

>> there is more risk in custody

Meaning? Confiscation? Theft? Some other risk?  Don't mean to be so dense but you have to go with what you were born with.

Fri, 02/14/2014 - 14:38 | 4437067 BarnacleBill
BarnacleBill's picture

Sorry to mislead re the postings on my blogsite. The "How to buy gold" item was posted in December 2012. The October post was the one titled "Gold, silver and war". Please forgive.

Fri, 02/14/2014 - 13:34 | 4436819 VD
VD's picture

central planning deformationz

Fri, 02/14/2014 - 13:37 | 4436829 Kaiser Sousa
Kaiser Sousa's picture

the "markets" r irrelevant...


p    e    r   i   o   d.

Fri, 02/14/2014 - 13:35 | 4436831 RebelDevil
RebelDevil's picture

hmm strange

Fri, 02/14/2014 - 13:37 | 4436832 order66
order66's picture

Key Volume Profile level in the ES. 1832. 

Buy side only crowd is predictable as hell.

Look for the move to 1835 and a sprint to 1840 in prep for new ATH's next week.

Fri, 02/14/2014 - 13:37 | 4436834 NoDebt
NoDebt's picture

Shorting the junk, buying the brand names.  Sort of the opposite of all last year where the most shorted names had the largest gains.

Fri, 02/14/2014 - 16:39 | 4437505 cro_maat
cro_maat's picture

Long nailguns! The banking cabal has more cleanup work to do.

Fri, 02/14/2014 - 13:36 | 4436835 dbTX
dbTX's picture

Cohen must be back at work.

Fri, 02/14/2014 - 13:37 | 4436836 Stoploss
Stoploss's picture

Looking more and more like GC says "fuck the paper, we're going to gold"

That means market up or down, gold is getting a bid..

The central planners worst nightmare has come true.

Fri, 02/14/2014 - 13:43 | 4436853 TeamDepends
TeamDepends's picture

"YAaaaYy"-  Crank Yankers Dude

Fri, 02/14/2014 - 13:38 | 4436838 bubblemania
bubblemania's picture


Fri, 02/14/2014 - 13:42 | 4436842 dexter_morgan
dexter_morgan's picture

It's Valentines day - gold is a girls best friend, give her some this year!

Fri, 02/14/2014 - 13:43 | 4436850 The_Ungrateful_Yid
The_Ungrateful_Yid's picture

I prefer just to give her my love muscle, such more rewarding.

Fri, 02/14/2014 - 13:52 | 4436878 akarc
akarc's picture

I always dip mine in chocolate this day of the year.  Long cocoa!

Fri, 02/14/2014 - 14:21 | 4437003 NotApplicable
NotApplicable's picture

Fondue tower, FTMFW!

Fri, 02/14/2014 - 14:00 | 4436906 ThroxxOfVron
ThroxxOfVron's picture

The 'glass ceiling' has been broken at State Dept., The FED, GM, HP, IBM, Pepsi, ADM, Lockheed, ADM, etc., etc...

So, guess what: it's time for the women to buy ME Gold dammit.

-& I'm holding out on her from now on if I don't get what the fuck I want 24/7.

Fri, 02/14/2014 - 14:13 | 4436953 cougar_w
cougar_w's picture

We have a black man as US president, and women in many top offices. Oh and the oligarchs they have printed $15T and given it all to themselves, ready to buy up the entire United States of American with cash at fire-sale prices.

All the evidence you need that the powerful white men who are really running the show are about to pull the plug and let the Titanic sink.

Fri, 02/14/2014 - 17:34 | 4437712 RumCurrency
RumCurrency's picture

There are no powerful white men left here.  They've already abandoned this fledgling banana republic and renounced their citizenship.

Fri, 02/14/2014 - 13:43 | 4436846 Stoploss
Stoploss's picture

The GBP/USD 30, is up quite nicely.

The USD/JPY 500, seems to be a strugglin some.


Oh, and gold is up.


Fri, 02/14/2014 - 13:53 | 4436883 Dr. Engali
Dr. Engali's picture

The shortbots are learning too.

Fri, 02/14/2014 - 13:54 | 4436887 Cdad
Cdad's picture

Well...one of the things that happened at that time was a hit to IBB...the true Bubble leader.  Volume was heavy.  Selling is continuing. 

Fri, 02/14/2014 - 13:56 | 4436890 fonzannoon
fonzannoon's picture


what happened here, I thought we wanted the etf to empty to zero?

Fri, 02/14/2014 - 14:00 | 4436898 Its Only Rock N Roll
Its Only Rock N Roll's picture

Zee German's have quitely said they don't need their gold back...aka the Fed told them to fly a kite since they donts gots it.

Fri, 02/14/2014 - 14:27 | 4437017 NotApplicable
NotApplicable's picture

So... just how much does 25.925 million ounces of Comex paper weigh, anyway?

Or did they get the finest tungsten money can buy?

Fri, 02/14/2014 - 21:07 | 4438333 hobopants
hobopants's picture

uhh im going to guess It weighs 25.925 million ounces?

Fri, 02/14/2014 - 15:48 | 4437331 lasvegaspersona
lasvegaspersona's picture

Total gold loss continues.

GLD may just be a short term anomoly.


If there really is no problem with sourcing physical then hey...we were wrong...everything wil be fine...let the paper market continue.

Unless the world's producers have suddenly decided that US paper is just the ticket and that real wealth in exchange for their real product is no longer a concern, we will see the draining of Western gold continue. Whatever is allowing GLD to increase their inventory I don't know. DB did just get out of the market and dropped about 10 tons. That could be the source for some of it.

As the above chart shows however the total gold leaving the West continues....just not from GLD. My prediction is that this is short term and the GLD drain will resume soon. We will soon see if a rising price does indeed allow GLD to add inventory. I say it does not. I think we will see that it hastens the drop. 

As the physical buyers of the world see gold rising in price they will want physical before the price rises.

Fri, 02/14/2014 - 14:01 | 4436900 Yen Cross
Yen Cross's picture

  I'm amazed that more people aren't talking about CL being @ or over $100.00 bbl as of late. I don't want to even think of how high it's going to go for the Spring-Summer vacation season.

Fri, 02/14/2014 - 14:02 | 4436918 Its Only Rock N Roll
Its Only Rock N Roll's picture

Olympics are on tee-vee, its cold and snowing in the winter months, there is a new season of the bachelor currently running and other domestic distractions.

Nothing to see here

move the fuck along

Fri, 02/14/2014 - 15:10 | 4437212 adr
adr's picture

There is no spring summer vacation season. Miles driven has been falling for years. Fuck, there aren't any more amusement parks near me and a trip to Disney World costs $2500.

Oil prices and the reasons given for the daily rise and fall are pure bullshit.

Fri, 02/14/2014 - 15:55 | 4437356 Jlasoon
Jlasoon's picture

Someone hasn't been to Disney in a while. Family of 4 for a week at Disney World (Park,Room,Food) an easy $10,000.



Fri, 02/14/2014 - 13:59 | 4436902 Tim Knight from...
Tim Knight from Slope of Hope's picture

A bearded old scholar named Ben

Goosed the market to highs now and then

His tenure is done

but more fun's still to come

now than Yellen just does it again

Fri, 02/14/2014 - 14:17 | 4436979 eclectic syncretist
eclectic syncretist's picture

Twas' Ben who started the Taper,

But it was a delicate Caper,

He got run out of town,

Like a common ass-clown,

And now Janet's the new Ass-raper.

Fri, 02/14/2014 - 14:00 | 4436907 viahj
viahj's picture

"at 1035ET, shorts started piling on..."

one of these times it won't be the short squeeze, it will be the take down.

Fri, 02/14/2014 - 14:04 | 4436913 NDXTrader
NDXTrader's picture

Let me guess: Credit Isn't Buying It

Fri, 02/14/2014 - 14:08 | 4436938 youngman
youngman's picture

Watch me at 1030 tonight and I will be doing something wierd too

Fri, 02/14/2014 - 14:16 | 4436974 DetectiveStern
DetectiveStern's picture

I work in funds control monitoring for unfunded payments (these things are usually very long chains ie expect to receive x to deliver to y to receive z which funds a payment to another bank)


Not looking forward to next week.

Fri, 02/14/2014 - 14:28 | 4437010 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

If you are into symbolism and language construction.



A “ten thirty-five exchange” or “1035 exchange” is a tax-free exchange of:

  • An existing life insurance policy for a new life insurance policy, or
  • An existing life insurance policy for a new annuity policy, or
  • An existing life insurance policy for a new qualified long term care policy, or
  • An existing annuity policy for a new annuity policy, or
  • An existing annuity policy for a new qualified long term care policy, or
  • An existing qualified long term care policy for a new qualified long term care policy.

Section 1035 of the Internal Revenue Code (IRC) regulates this type of Tax Free Exchange between life insurance, annuity policies, and long term care insurance, hence the name of this website.

A key requirement of a 1035 Exchange is that the owner not be in constructive receipt of the surrendered policy value. In cases where the old and new insurance companies are different, this is generally accomplished by the policy owner assigning the existing policy to the new company, who will then surrender the old policy after the new one is issued, and accept delivery of the surrendered policy's values directly from the old company, and apply them to the new policy.


Put it in context with the JPY/USD trade pair and S & P 500. Corporations are people and the NYSE is a corporation.



The most common reason why an old life insurance policy or old annuity policy is exchange for a new life insurance policy or new annuity policy is because newer policies often perform much better than old insurance policies, due to improvements in mortality (lower insurance cost), reductions in policy administration expense (lower costs), improvements in underwriting (lower costs), improvements in the insureds health (lower cost), improved interest crediting (higher rates of interest, and interest linked to an index), and in some cases, worsening health (higher annuity payments).


We shall see in the next few days what the S & P couples with instead if this is the case.


Fri, 02/14/2014 - 14:32 | 4437044 Dewey Cheatum Howe
Dewey Cheatum Howe's picture

If I had to guess the parasite has found a new host to drain dry...

Fri, 02/14/2014 - 14:54 | 4437121 Father Lucifer
Father Lucifer's picture

1:51 with a break above 1150 the most shorted will run for cover. Any minute now.

Fri, 02/14/2014 - 15:18 | 4437244 f16hoser
f16hoser's picture

I just bought 40 more Oz's of Silver today. No worries here Mate! You can chase HFT platforms all day if you want, me, I'll keep stacking and racking!!!  Speaking of Racks" time to go find the wife!!!

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