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Dollar Flash Crashes

Tyler Durden's picture


No headlines on the tape for now but suddenly the world wants out of Dollars... (world's FX traders searching for Sikorski and Putin's "sell" button)... It appears led by major JPY buying as someone just puked a huge carry trade (25,000 JPY futures contracts or around $3 billion notional).

USD flash crashes...


Led by heavy volume in JPY (JPY buying or carry unwinds)


Heavy volume in futures...(25,000 JPY futures contracts or around $3 billion notional in the surge)


With USDJPY's biggest drop in 4 months...


Whocouldanode: 50 minutes ago...


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Wed, 08/06/2014 - 12:23 | 5054431 firstdivision
firstdivision's picture

I was wondering why I heard a sound like a million Yellen's crying out.

Wed, 08/06/2014 - 12:25 | 5054441 Jack Sheet
Jack Sheet's picture

Yellen's spread is widening as we read this....

Wed, 08/06/2014 - 12:29 | 5054470 SWCroaker
SWCroaker's picture

Bad bad mental image you evoked.  Shame on you.

Wed, 08/06/2014 - 12:52 | 5054580 Buckaroo Banzai
Buckaroo Banzai's picture

Ugh. Apply liberally until symptoms subside:

Wed, 08/06/2014 - 12:55 | 5054590 linniepar
linniepar's picture

Don't tptb want a weaker dollar? Just not too weak! (Read, worthless)

Wed, 08/06/2014 - 13:13 | 5054678 Four chan
Four chan's picture

fat finger

Wed, 08/06/2014 - 13:30 | 5054757 Leonardo Fibonacci2
Leonardo Fibonacci2's picture

De-Dollarization marching forwards to Moscow. Yeah!!!

Wed, 08/06/2014 - 14:27 | 5054766 Say What Again
Say What Again's picture

At the risk of sounding repetitive, I want to point out that a number of the BEAR ETFs had significantly large Avg-Trade-Size events a few minutes prior to the ForEx stuff happening.  Note that this does NOT show up on the volume readings.  What I am talking about is a few very large trades going off a few minutes prior to the forex.

This is actually an old trick that has been discussed in older books on trading.  If an institution is planning to sell a large block of stocks and they feel there will be significant market impact, they will hedge prior to selling by either shorting the futures or buying puts.  This technique has become less effective these days, due to the effects of HFT, but maybe they're using the cross between ForEx and ES. 

At this point, its just a guess.

Wed, 08/06/2014 - 14:01 | 5054911 A82EBA
A82EBA's picture


Wed, 08/06/2014 - 14:21 | 5055012 Kirk2NCC1701
Kirk2NCC1701's picture

Ebola-free Spread.

Wed, 08/06/2014 - 12:29 | 5054471 Bananamerican
Bananamerican's picture

Mind bleach

Wed, 08/06/2014 - 13:00 | 5054610 Howard_Roark0112
Howard_Roark0112's picture

I'm long mind bleach!

Wed, 08/06/2014 - 12:31 | 5054477 Hugh G Rection
Hugh G Rection's picture

Are we going to have to start paying Israel's ISIS terrorists in Renminbi now?

Wed, 08/06/2014 - 14:22 | 5055021 Kirk2NCC1701
Kirk2NCC1701's picture

30 pieces if Ag will do.  Same as our Ploticians.

Wed, 08/06/2014 - 12:31 | 5054478 PartysOver
PartysOver's picture

Dude, thanks for the friggin visual.  Now I can't see my charts not to mention I puked a little.

Wed, 08/06/2014 - 12:32 | 5054485 CunnyFunt
CunnyFunt's picture

*** projectile vomit ***

Wed, 08/06/2014 - 12:36 | 5054506 French Frog
French Frog's picture

This is the sort of post that does ZH no justice: how can you call a 0.2 fall in the $ Index as a Flash Crash or even a Crash! The mind boggles...

Wed, 08/06/2014 - 12:46 | 5054555 MsCreant
MsCreant's picture

Gold has popped...

Wed, 08/06/2014 - 13:04 | 5054632 quasimodo
quasimodo's picture

Yes, and tomorrow we will be saying Gold has dropped. Wake me when it jumps $50, otherwise it's just noise. 

Wed, 08/06/2014 - 13:27 | 5054750 Rubicon
Rubicon's picture

Its just jumped $50...


Wed, 08/06/2014 - 13:19 | 5054715 NotApplicable
NotApplicable's picture

Are you trying to say this is normal? I'm no rocket scientist but I think you're dismissing the element of time, hence the word "flash."

But yes, I'll agree that ZH sometimes has a flair for the over-dramatic.

Wed, 08/06/2014 - 12:39 | 5054525 GOLD AND SILVER...

I'd hit it.  Think Punish Tube.

Wed, 08/06/2014 - 12:48 | 5054560 MsCreant
MsCreant's picture

What if you liked it and wanted to be her slave boy forever?

Wed, 08/06/2014 - 12:54 | 5054588 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

What if you liked it and wanted to be her slave boy forever?

There are cyanide pills for that!

Wed, 08/06/2014 - 14:39 | 5055127 JRobby
JRobby's picture

(25,000 JPY futures contracts or around $3 billion notional).


That's gonna leave a mark. Janet!!!!

Wed, 08/06/2014 - 12:45 | 5054545 world_debt_slave
world_debt_slave's picture

Dr. Seuss?

Wed, 08/06/2014 - 12:54 | 5054586 kurt
kurt's picture

The same as when Spock heard Vulcan blow up. The same as Ka-El witnessing Krypton explode. The "oh, the humanity" blimp. Let me know if you'd like more examples.

Wed, 08/06/2014 - 12:24 | 5054434 McMolotov
McMolotov's picture

"Let's not get into panic mode!!!" —George Costanza

Wed, 08/06/2014 - 12:24 | 5054442 TahoeBilly2012
TahoeBilly2012's picture

The Putin puke up.

Wed, 08/06/2014 - 12:40 | 5054520 Quus Ant
Quus Ant's picture

Puzzling.  Why is this happening now?  Are we to believe countries haven't been trying to dump their dollars for quite some time?  The fat finger is mysteriously MIA when Russia announces retaliatory sanctions... hmmm... Could it be TPTB will let the dollar die and blame it on Russian sanctions?  Shit the bed and make tracks with a new cold war as cover? 

That's my bet.  At this juncture.

Wed, 08/06/2014 - 13:22 | 5054727 Chief KnocAHoma
Chief KnocAHoma's picture

Cold war my ass! This one will be HOT! The Israelites will fight along side the Saudis to squash ISIS - Iran may even pitch in. Russia will start marching, China will start sailing, Argentina will cut ties to the Crown and all that will happen in chapter one.

Wait until we get to chapter five!

Wed, 08/06/2014 - 13:25 | 5054741 Quus Ant
Quus Ant's picture

Maybe.  I'm hoping no one wants WWIII- just the stupor and goosestepping generated by the thought of WWIII.

We'll see soon enough.  Turn the page...

Wed, 08/06/2014 - 12:32 | 5054483 IronShield
IronShield's picture

IF you're going to panic, panic first.

Wed, 08/06/2014 - 12:50 | 5054567 insanelysane
insanelysane's picture

Look for the guy not panicing to find out who did it.

Wed, 08/06/2014 - 14:24 | 5055025 Kirk2NCC1701
Kirk2NCC1701's picture

Serenity now!  Serenity NOW! - George Costanza

Wed, 08/06/2014 - 12:24 | 5054438 timeless21
timeless21's picture

WWIII bitchez

Wed, 08/06/2014 - 12:35 | 5054499 JuliaS
JuliaS's picture

Duck and cover.

Wed, 08/06/2014 - 13:20 | 5054713 Theosebes Goodfellow
Theosebes Goodfellow's picture

"Turn that bird loose and come out from under that blanket this instant!"


Wed, 08/06/2014 - 12:25 | 5054444 LawsofPhysics
LawsofPhysics's picture

Why no corresponding crash in all those things priced in dollars in the open "market"?




Wed, 08/06/2014 - 13:07 | 5054648 Howard_Roark0112
Howard_Roark0112's picture

Because a a 20 pip move over 30min on no news in the FX market is acutally pretty common, not exactly what I would call a flash crash... Thanks ZH, articles like this make me wonder why I keep coming back here. I guess it's a cleanest dirty shirt type thing...

Or maybe I just like all the doom porn. 

Wed, 08/06/2014 - 14:24 | 5054989 WhyWait
WhyWait's picture


I know how you feel, like emotionally you're being played, but you might as well take ZH for what it is, and pick your level of involvement and otherwise just sit back and watch the show!

If I had money in play, knowing something dramatic is about to happen, maybe this week, certainly in the next few months, a chain of events that will involve the liquidation of trillions of dollars in paper wealth; If I had wealth to manage and know an economic and political earthquake is imminent; one which, because it has been postponed so long, could at this point start anywhere and be triggered by some seemingly random event, I would be glued to this microdata looking for a signal on which way to jump.

As a former scientist who spent many years staring at seemingly random data trying to tease information out of it and working out how to separate meaningful signals from false signals and noise, I certainly recognize the process. Ancient peoples seeking signs for which route the herd would follow this year or when it's safe to plant faced the same problem.

I've also watched dozens of Baccarat players I've watched, searching for and betting on patterns in the utterly randomized sequence of the fall of the cards, passionately defending their latest theory that will make them rich.

I would hope and expect ZH has more to offer the investors than just reasons to be skittish.

As an organizer of unemployed and desperately underemployed regular folk, ranging from former bricklayers and machine operators through professionals of all kinds, I need only to be able to help people think in broad strokes about what to expect over the next months and years, and don't need that kind of detail, but I will never fault ZH for publishing it. Those investors are the bedrock and support of this site, and we owe them thanks for that.

When the moment comes to make a big move, millions will get burned because by its very nature such busts happen when investors - ZH readers included - are powerfully motivated to do the wrong thing.

"If I were a rich man, la de da de da de da .... "

I would pay careful attention to Tyler's stories about the psychological aspects of booms, bubbles and busts right about now - remembering that I as an investor am very much a part of those psychological aspects, living them from the inside.

Wed, 08/06/2014 - 12:24 | 5054445 Osmium
Osmium's picture

No worries.  That shit happens to paper gold all the time.

Wed, 08/06/2014 - 12:40 | 5054526 Long-John-Silver
Long-John-Silver's picture

Everything that's manipulated are subject to flash crashes.

Wed, 08/06/2014 - 12:25 | 5054448 NOTaREALmerican
NOTaREALmerican's picture

This is the NSA !     All fx traders, stand up and back away from the keyboard!  

Wed, 08/06/2014 - 12:26 | 5054454 SheepDog-One
SheepDog-One's picture

Get to work Mr Yellen! :D

Wed, 08/06/2014 - 12:27 | 5054457 Cheduba
Cheduba's picture

Come on dollar limit down and silver limit up!

Wed, 08/06/2014 - 12:41 | 5054534 TahoeBilly2012
TahoeBilly2012's picture

Plus gas lines and hordes in the streets.

Wed, 08/06/2014 - 12:28 | 5054465 Yen Cross
Yen Cross's picture

     How many {units?} did Gartman say he was short yen again?

Wed, 08/06/2014 - 12:28 | 5054466 Keltner Channel Surf
Keltner Channel Surf's picture

Might be part of Putin's 'retaliation', declaring that henceforth all black market goods must be paid for in rubles, not dollars.

Earlier this year we had a few days of carry trade air pockets, and if memory serves it did not end pretty.  Too early to tell, but VIX's rising slightly, stocks deciding whether to do the typical post 12:30 dip or turn back up ...

Wed, 08/06/2014 - 12:30 | 5054473 q99x2
q99x2's picture

Avoid anything related to the FED, Obama.and Banks. The Washington D.C. government sucks. Big time.

Wed, 08/06/2014 - 12:33 | 5054492 Ness.
Ness.'s picture

The world's reserve currency just got bitch slapped in a matter of seconds on a dataless Wednesday afternoon.  


I am Jack's cold sweat.

Wed, 08/06/2014 - 12:36 | 5054511 kito
kito's picture

its down 3 cents. wtf are you talking about tyler?

Wed, 08/06/2014 - 12:45 | 5054553 kito
kito's picture

LOL.  fonz your ability to endlessly pull zh theme/thread related clips from your hat is beyond impressive.....

Wed, 08/06/2014 - 12:49 | 5054562 insanelysane
insanelysane's picture

Fonz gets them from the NSA data store that has excellent search capabilities and is fast too.

Wed, 08/06/2014 - 12:38 | 5054517 Yen Cross
Yen Cross's picture

    BAC went short the aud/usd yesterday with a stoploss @ .9350. They're starting to become my new Tom Stolper indicator...

Wed, 08/06/2014 - 12:39 | 5054521 Pesky Labrador
Pesky Labrador's picture

Would this happen to be related to Russia's reactive sanctions this morning?

Wed, 08/06/2014 - 12:42 | 5054532 paddy0761
paddy0761's picture

Let's not all jizz in our pants here. That is a nothing move; in the big scheme of things. No major support levels have been breached. 

Wed, 08/06/2014 - 12:47 | 5054556 insanelysane
insanelysane's picture

Fat finger, nothing to see here, they meant to sell 5,000,000 metric tons of gold to slam it down, move along.

Wed, 08/06/2014 - 12:46 | 5054557 Spungo
Spungo's picture

Don't worry, that's just the paper paper. Real paper is still worth something.

Wed, 08/06/2014 - 12:48 | 5054561 medium giraffe
medium giraffe's picture

Big fat fingers.

Wed, 08/06/2014 - 12:49 | 5054568 orangegeek
orangegeek's picture

USD went from 81.65 to 81.47 - what's that?  about 2/10's %?


interestingly, the euro made a move from 1.3355 to 1.339 - a few smidges of a %


USD still in bull trend, euro still in bear trend

Wed, 08/06/2014 - 14:31 | 5055079 oudinot
oudinot's picture

Yeah,I tend to agree with you:  I think Tyler let his heart outvote  his wonderful mind on such exaggerated analysis headlines.

I do agree with him that the USD is eventually doomed.

Wed, 08/06/2014 - 14:48 | 5055178 orangegeek
orangegeek's picture

disagree about the USD, but we'll see what happens


Yep - Tyler is human - but he puts up this wicked site which is changing the world and pissing off the finance "bullshit machine" establishment at the same time for the revenue of a few ads.


Got to love Tyler!!!!!!!!!! 




Wed, 08/06/2014 - 12:50 | 5054569 Bemused Observer
Bemused Observer's picture

The dollar should die already. Time to move on. Its 'day in the sun' is over.

And good riddance! Not only is it becoming worthless, it's butt-ugly. We have some of the most unattractive currencies on the planet, and they get uglier by the day with every design-change they introduce. Washington may have been a great general and President, but even he would agree that his mug shouldn't be on the currency. And if you asked those other guys, they'd say the same thing about their mugs.

I came across some old foreign currency at a yard sale this past weekend. Didn't buy it, but I sure did admire it. The colors! The beautiful imagery! Ok, most also had butt-ugly portraits of various past leaders, but they weren't troublesome, as there was just so much to admire on the rest of the bills.

All fiat currency eventually becomes worthless. So, why not at least make the stuff pretty? Then we can use it creatively for other things. Like tiling a floor with old wheat pennies...Lincoln's no beauty, but the copper takes on a real nice patina. (Use wheat pennies, as they are made of real copper. Zinc doesn't age as well.)

And, when I priced some tile made of "copper rounds", guess what? They were almost twice the price per square foot than it would cost you to use the pennies!
THAT'S how worthless our money is...not even worth what it's made of.

Wed, 08/06/2014 - 13:07 | 5054654 aardvarkk
aardvarkk's picture

Shut up, dude.  If the Obamaniacs hear you, next thing you know we'll have OBAMA on our money.  And then I'm going to have to throw up every lunch just when I go to pay for it.

Nobody should be forced to carry pictures of Obama in their pockets.

Wed, 08/06/2014 - 12:57 | 5054600 Fix It Again Timmy
Fix It Again Timmy's picture

There's money:

And then, there's real money:

gold images

Wed, 08/06/2014 - 13:12 | 5054671 yogibear
yogibear's picture

A US dollar crash is the only thing that will panic the fed. Once the Fed loses control it's over for the currency. They lose credibility as well as power  and become purely reactive.


Wed, 08/06/2014 - 13:14 | 5054688 Keltner Channel Surf
Keltner Channel Surf's picture

Yeah, no catastrophe, but a vertical move in 4 min from 102.28 to 101.78 in USD.JPY was certainly worth noting by Tylers Inc. (hell, even Pisani just reported on it), but more important this 12:10 move seems to have coincided with at least an interim bottom in the volatility measures for the indices, with prices now back to 10:30 levels.  Will be interesting to see if we do a round-trip down, or if the 1:30 buyers return hungry from lunch ...

Wed, 08/06/2014 - 13:19 | 5054714 atomicwasted
atomicwasted's picture

A 0.2 drop is hardly a "flash crash."  Look at the scale of the graph.

A drop of 5.0 or more would qualify in my view.

Wed, 08/06/2014 - 14:26 | 5055038 JaKst3r
JaKst3r's picture

Gold & money Pr0n sex sexy sex x

Wed, 08/06/2014 - 14:32 | 5055043 Kirk2NCC1701
Kirk2NCC1701's picture

Suffer, Jet City!  Jumpin' Hack Flash, it's a gas, gas, gas!  Jumping Jack Lew, it's a gas, gas, gas! 

Oh, wham, bam, thank you Ma'am.

Wed, 08/06/2014 - 14:37 | 5055112 oudinot
oudinot's picture

I don't enjoy the mixed metaphors between David Bowie and Rolling Stones song lyrics.

They both enjoy  a plentiful song inventory , I strongly advise to pick one at a time, there's plenty to pick from......

Wed, 08/06/2014 - 14:41 | 5055133 eurusdog
eurusdog's picture

Yep it crashed .25% Just a bit more than the .22% it soared on 7/30/2014 Hasn't even given up the entirety of that gain yet.

Wed, 08/06/2014 - 15:26 | 5055359 Raging Debate
Raging Debate's picture

Paddy - I agree. I do love ZH for putting up the currency moves.

Wed, 08/06/2014 - 16:25 | 5055714 gcjohns1971
gcjohns1971's picture


"“You can’t escape the stratosphere,” Sebastien Galy, a senior currency strategist at Societe Generale SA in New York, said Aug. 1. It’s “a broad dollar world which is dominating everything and the consequences are suffered when there’s mismanagement of the system. But it’s one that has no good alternative at this point in time.”"

Wed, 08/06/2014 - 16:40 | 5055789 AdvancingTime
AdvancingTime's picture

The games central bankers are playing in supporting their and other currencies has reached a dangerous level, we may be in the "red zone". Currencies are important chips in the commerce of government and the business of running a country.

History has shown that in the past both leaders and governments have fallen with the demise of their coin. If people lose faith in the system it could just come crashing down around our ears. At a time when billions of dollars can be traded in just the blink of an eye imagine how fast things could go to hell. More on this subject in the article below.

Do NOT follow this link or you will be banned from the site!