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Manic-Buying Turns To Panic-Selling As 'Illiquid' Stocks Plunge To 5-Month Lows
Just as we warned, liquidity was incomprehensibly low today (below normal pre-market levels during the peak of the trading day) and the intraday whipsaws were meteoric as a closed cash bond market enabled the slightest twitch in USDJPY to send S&P algos into conniptions. Biotech crashed. Trannies were ripped ridiculously higher at the open - then collapsed into correction (-11% from highs); US Airlines have fallen for 6 straight days, crashing 17% (with today's 7% plunge - driven by chatter over airborne Ebola - its biggest in over years). Tresury futures implied a notable drop in yields across the curve (10Y -7bps at 2.21%, 30Y 2.97%, and 5Y 1.45%). The USdollar closed -0.33% led by EUR and JPY strength (but AUD surged 1% extending gains after China data). Gold ($1234), Silver, and copper all gained on the day as WTI fell once again (despite some intraday strength in the middle of the day). Stocks "flash-crashed" on very heavy volume in the last 30 mins with VIX breaking above 24 (highest in 16 months). All major equity indices are now below their 200DMA with the worst 3-day loss since late 2011.
Liquidity was simply not there - but but but HFTs?
eMini liquidity is lower than normal pre-market levels $ES_F $SPY pic.twitter.com/dJXkRGA2Gt
— Eric Scott Hunsader (@nanexllc) October 13, 2014
Which meant - just as we warned - epic whipsaws in stocks...
As USDJPY tested down towards 107...
and Tresasuries led stocks lower all day...
Leaving all the major indices red on the day (even after Russell tried to stage a big comeback)... just look at Trannies at the open!! (that's not a fat finger!!!)
A look at futures trading shows the magical levitation overnight giving way to reality in the US session...
Year-to-date, Dow joins Russell in the red, Nasdaq getting close...
VIX punched above 24...
Stocks - always the last to catch on..
Airlines index crushed...
Bonds may have been closed but futures implied some big yield drops on the day...
Credit was closed today but just as a quick context for where stocks might end up...
FX markets were also thin but notable moves in AUD and SEK as the USD weakened again... the moves were dominated by the overnight China data
Commodsities rallied (on safety and weaker dollar) but WTI fell once again... (even after a modest rally intraday)
Charts: Bloomberg
Bonus Chart: Remember what happened the last time Japan raised taxes...
Bonus Bonus Chart: Hindenburg Omen 2008 and 2014...
In summary:
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2+2+3=...
...WTF!
Price of oil down, is it because of lack of demand or large supply or both? How many airllines are stuck with large pension fund liabilities?
If people are using crediit cards to buy food you can't expect them fill up gas tanks or buy airline tickets.
I''m not worried because I'm only about a mile from the Ground Zero Ebola apartment in Dallas also my my cardiologists is just across the street from the Presbyterian Hospital Emergency facilitiy. On top of that the DART bus I ride goes right by that apartment and the hospital.
I was thinking about that as I rode DART today, listening to listening to people cough and hack from all the alergens in the air, and some nasty lung rot that is going around. Like on Drudge. Center For Disease Confusion. So I'm not real worried about the price of oil right now.
$85 oil will rinse out the marginal frackers resulting in low supply, low demand, and low prices - the deflationary trifecta. This is the natural effect of there being no real growth and no real capex since this whole party got started. The pie is smaller now.
This market is so easy to trade, just BTFD.
Time to start placing penny bids I think
Did somebody say out of control?
http://youtu.be/Emdzsz_XvfA
Again here we go with another article of doom. And how this is just proof of the end. I have read and followed all this crap from zerohedge. Guess what year after year all this doom does not happen. Ok so some day some yr there will be another crash. But I have just spent the past 6 yrs listening to the doom of zerohedge. I want to delete my connection to this site. And by the way, ebola is not going to be the end. Just like all the other crap zerohedge promised was the end. Please how do I delete my connection ?????
The Zombies cant eat your brain if you donT give them the power.
Fight the FED!
Think of it like watching a snow packed mountain side for an avalance. All the scientists tell you it could go any day. Now the marketing department as the ski resort below says the nay sayers are full of shit. "Look see all the people skiing on the slopes there. Everyone is having a grand time and sales have never been higher so shut the fuck up". Next year a similar story follows, and possibly the next. The scientist starts to look like an idoit to the dumb joes. The reality however is that the measurements have been take, the snow depths and temperatures are known and all of the historical data tells the scientists to stay off that fucking mountain.
In short feel free to take your chances just don't expect company with an IQ above 100.
This will be the most widely predicted economic collapse in the history of the planet.
Some "powder-greedy" people probably even have a high IQ.
But maybe we should reconsider how we define intelligent.
Agree 100%
Id say you need an IQ above 100 and a very healthy and high Emotional IQ
http://www.amazon.com/Emotional-Intelligence-Matter-More-Than/dp/055338371X
WOW you read for almost two years before you became a member. That is amazing. What with your knowledge and unequaled financial understanding why did you wait so long?
BTW ZH is a free website. You are allowed to go to another web page and except for the NSA tracking not a single poster here would ever know or care.
"Splain me Lucy ILLIQUIDITY?"
Perfect post for today, the problem is people extrapolate into tomorrow....silly humanz.
On September 24, 2014 was the first day of the Shemitah Year. On that very day markets dropped 1.5% on average. A shemitah year occurs every 7 years on a hebrew calendar.
Johnathan Cahn wrote an excellent book *all* market crashes occur on Shemitah years and two of the largest market collapses TO THE DAY occured on the last day of the Shemitah Year.
This is no exception. This shemitah year will end on September 13, 2015. I fully expect a massive market collapse on that day (what is left of it between now and then).
The Shemitah Year and a month or two around it let me repeat has predicted every single market/economic collapse / recession in the last 100 years without EXCEPTION.
The only thing to do is sit on the side lines or if you can time the tops short only.
I wonder why that would be?....The Day the Colon Fell Out of The Ass.....
Care to back that up with dates and index prices? This is the first I ever heard of SHEMITAH. Something conjured by CFR?
You bet.
2001-Sep-17 (29 Elul 5761) Last day of Last month of 7 year cycle - last day of Shemitah Year - Market reopen from September 11th, 2001, and crash 684 point 7 %
2008-Sep-29 (29 Elul 5768) Last day of Last month of 7 year cycle - last day of Shemitah Year - Market collapse 777.68 (777.77 points) 7.1%.
2014-Sep-24 (1 Tishri 5775) First day of Shemitah year markets collapse 1.5 % Every day forward markets have become extremely unstable and un reliable.
2015-Sep-13 (29 Elul 5775) will be last day of last month of 7 year cycle - I expect the Japanese earthquake to hit around or just prior to this event.
I *highly* recommend you buy this book and read it (you can get it immediately as a kindle download)
http://www.amazon.ca/The-Mystery-Shemitah-000-Year-Old-Americas/dp/16299...
Johnathan Cahn goes back 100 years and looks at every recession / correction / depression the Shemitah Year hit overlapped these events every single time.
Thank you, this is the true intent of the internet. Thank you for sharing.
Jesus Christ. Christ is Crisco in Greek. Crisco is oil. Jesus Oil.
Cristo dude.
I just woke up . WTF happened???
Not enough buyers. Especially towards the end of the trading day. That's all.
Falling prices are good. With my 612 FICo I could be driving a Mercedes.
I see a lot of cars and semis on the road, lots of people working, and lots of help-wanted signs. When should I buy oil?
fucking piece of shit banksters, i hope this is just the fucking beginning of the collapse and that these fucking assholes suffer 100x as much as they have inflicted pain on the middle class all these years.
cant fucking wait until the real estate markets blows up and these bastards r left with nothing, i cant fucking wait until bankers r jumping from every building, lets hope we see this shit very fucking soon.
i am tired of these fuckers already
Federal Reserve soon reversing the taper soon and stepping on the accelerator pushing massive QE4.
Massive fed printing soon.
Any time now.
The big question is: Is this just a long awaited "correction" or is this "the big one". I think the VIX move to 24 is significant, but I think we would need to see VIX in the 50's and more than a 15% broad market correction before we will see another "big crash".
The S&P is down a bit over 7% now from its mid-september peak, so we're already half way there in less than a month.
Unfortunately the down market could really snowball, thanks to our $730 trillion dollar shadow banking system (which towers over the mere $70 trillion stock market). Watch the big 5 banks as they rush to cover their derivative "bets" - when the first one fails it will be "Katie bar the door".
Then it will be "To QE Infinity and Beyond" since the Fed has no other arrows left in their quiver. They'll also be buying "junk paper" from the insolvent banks again, since they can't let them go bankrupt (derivatives get paid out first under the 2005 bankruptcy law - account holders get paid last - the definition of insanity).
I'm with you Yogi. I expect a grand announcement at some pt. It will either cause massive hyperinflation (the likes of even their lyin ass cpi index super turbo charged calculator deflators can't hide) or it wont work and after a day and a half we fall into the abyss.
Either way I'm cool with it.
....chewing.......
Like a cow chewing cud while it mindlessly watches the strange procession of fellow cows getting loaded up into a loading chute before being spooked by the rancer into the back of the semi...
I'm stuck in the herd lights of that last pic.
POMO in the morning. SPX should see a bounce.
http://bullandbearmash.com/chart/sp500-hourly-closes-day-straight-day-po...
And then we fall again in the afternoon.
I've been waiting soooo long. Happy days.
spx potential short target is the 61.8% level from recent highest H to L of March 2009. 2019/667 do your own math.
1.35% after 6 years....