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This Is What Today's HFT-Driven Canadian Dollar Flash Crash Looked Like
Back in March of 2014, when Virtu had just released its first attempt at going public (soon to be followed by a second one now that everyone has apparently forgotten that HFTs are nothing but frontrunning, market-destabilizing predators), we wrote "The Is The One Financial Product Now Targeted By The HFT Swarm" in which we showed that with equities no longer a fertile ground to frontrun whale orders, what the algos were focusing their attention on was currencies.
Earlier today, we got a glimpse of precisely how HFTs are now making a mockery of FX "price discovery" when completely independent of any newsflow, Canadian Dollar futures cratered on what is merely the latest of many flash crashes now coming to an FX market near you. Courtesy of Nanex:
This look familiar? Canadian Fx futures shows same pattern we see in US Stock flash crashes: pic.twitter.com/SXyGA4sJ6q
— Eric Scott Hunsader (@nanexllc) February 19, 2015
And putting the flash crash in perspective:
Expect many more such "completely unpredictable" flash crashes in your favorite FX pairs now that algos are increasingly desperate to launch momentum ignition and stop hunt raids in the one asset class which has none other than central banks as the only remaining players.
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One day it won't be a flash.
That shit is so looney man!!
+1,000,000 for the looney reference.
It's nauseating to hear low Iq countrymen of mine whine about their junkets to the USSA get more expensive. The lew knee could crater for all I care. When we sell our oil in USD ( until we don't ) it will be more better. LEt the USD have it's crack up boom. The sooner this ends the sooner we can get to where we're going no matter which way is which/
It'll rhyme...
Poetic justice if the AI that the moneychangers created takes down their whole enterprise.
pods
i see a marble (large) sitting on top of inverted bowl, immersed in an expensive anti-gravity field, all of which is being pummeled by a monster electrical storm
I expect one day soon the markets will cease to function because the algo's will be driving to the stops and causing freezes constantly. We'll get to see the system self-destruct one automated bid at a time.....
Stop hunt central banks? Do they have stops??
I liked that tapebomb the S&P dropped on the Australian$ in the middle of the night about a possible ratings downgrade. It's a good thing I was short aud/jpy.
But but...LIQUIDITY, no more questions.
I was watching, looked like more of a fat-finger to me. True, robots can also fat finger and get the size wrong.
Rabo Bank did so a few years back with Cable, put the market up about 70 ticks in a min, down 70 ticks in the next min. Size shoulkd have been say 1million, computer did 100million etc.
The interesting thing about these crazy moves - the market is odds-on to go back there, or near enough. CAD did this.
It retraces immediately so maybe it was dropped take out someones position.
For whatever reason; to match other positions with that or maybe just to steal. You bet those FX hubs/aggregators/internalizers/order flow buyers/etc. know where stops and thus liquidity are.
USD/RUB was sliding too the last few days, so some dollar momentum ignition vs commod currencies might have come handy.
Generally, these FX algo guys are a den of thieves and can rig prices for a few dollars profit literally.
But you only can steal so much before the flow dries up and it has to become more overt, and you can't have central banker soundbites for the cover all the time either.
IM ABOUT TO BARF, HOW DO YOU GET OFF THIS RIDE?
Blue pills. Lots and lots of blue pills.
"IM ABOUT TO BARF, HOW DO YOU GET OFF THIS RIDE?"
Buy gold, bitchez...
40¢ ain't no flash crash. Just banks scratching trades with one another.
40 cents is huge are you stupid?
pips...
I think there's gonna be a lot of HOT flashes around the world in coming months/years!
I really don't see how we survive in this environment as a species for the next 10 years...I really don't.
As a species, we remove ourselves from this environment.
More importantly, how does one buy such "dips". Come on ZH, give us something we can trade!
Take out the bounce and this is what the market will look like when it finally vaporizes.
Dear algo, yesterday I asked you for anharmonic oscillator. Thank You VERY MUCH!
so 4 tenths of a percent, in a commodity currency, on a day when oil actually does crash 5%, is a flash crash?
ok..........mustn't be any real news today?
...I thought the same thing .7995 to .7960 and back to .7995 doesn't seem like much.
I thought the $ dropped 4 cents the way the story said it...until I put my glasses on and looked at the chart.
Hello, this is Step Function Trading Company, how can we help you today?
Heah, if you can't take a joke...
Stupid price movements occrur all the time in spot FX. Must be nice to have 8 or 9 figures +++ to pike around in the market at any given time.
I love rigged markets
Loony was at the top of a desceding trendline starting a downward wave 5 plus the announcement yesterday was dollar negative. USDCAD was telling everyone to short it. No big surprise