Gold Soars As Draghi "Dud" Unleashes Chaos In Bonds, Stocks, & FX

Tyler Durden's picture

"You get nothing..."

 

This was not the day many had planned on...After the initial "as expected" move, everything went pear-shaped for the central planners when Draghi committed the ultimate sin - closing an open-ended monetary policy...

 

The USD was hammered, gold surged, and stocks and oil gave up gains...

 

Then The PPT stepped in to save the world, ramped us back to VWAP...

 

And Dow back to 17,000...unfriggingbelievable!!

 

*  *  *

Surveying some of the damage (that was unable to benefit from US manipulation)...

Let's start with the worst...EURUSD screamed almost 400 pips off the post-Draghi lows...

 

As Bespoke notes, today is the largest positive reversal (3.2%) off an intraday decline of at least 1% in the history of the Euro.

 

We could show all kinds of epic fail European markets, but Italian banks - with their exploding NPLs - are the best example. After smashing to a halt limit-up, they fell back to earth to practically unchanged by the close...

 

*  *  *

After yesterday's idiotic ramp to perfectly end Dow at 17000, things went a little bit turbo today...until the late-day re-emergence of America's own National Team...

 

The plunge stalled when Europe closed - went sideways - then ripped higher to unch as NYMEX closed...to get the S&P 500 perfectly unchanged!

 

Look at the utter panic VIX slams to get Dow back to 17,000 (just like yesterday)...

 

As Shorts were once again squeezed...

 

Treasury yields all rose on the day (with the belly underperforming and 30Y outperforming after a strong auction all the way back to yields lower on the week)...

 

Dragged higher in yield by Bund weakness (as Draghi disappointed expectations for the rate cut)

 

Early in the day, the TSY yield curve collapsed to its lowest since Dec 2008...

 

Not boding well for the Dimon Bottom?

 

The USD Index was monkey-hammered as EURUSD's initial drop exploded into an avalanche of short-covering... The biggest daily drop in over a month..

 

Gold ansd Silver outperrformed on the day as crude and copper slipped lower...

 

Gold recovers its quintuple whammy slams...

 

And oil rallied back as Europe closed for absolutely no good reason at all...

 

Finally, Oil Vol remains notably "cheap" relative to equity protection (for now)...

 

Charts: Bloomberg

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Keltner Channel Surf's picture

"Yellen's Army"        from "Oliver's Army"     by Elvis Costello

Don't start me trading, I could trade all night
My mind went jaywalking, while I was putting up the fight
Called careers information
Trading’s not considered an occupation

Yellen's army is here to stay, Draghi's armies are on their way
And I would rather be anywhere else
Than in these markets today

There was a Plosser, Charlie, he didn't crack a smile
But it's no laughing party
When doves are all lined up for miles

Only takes one inflation trigger
But central banks don’t have much rigor

But there's no danger -- it’s no ’professional career’
Though it could be arranged
By taking the Skittles from Mrs. Yellen’s beer

If you're out of luck or out of work
Just access NYSE from the suburbs

Yellen's army is here to stay, Draghi's armies are on their way
And I would rather do anything else
Than trade these markets today

Pandelis's picture

Schwable will be furious ... if anybody cares ...

pods's picture

Thought this article was about me. 

nvmnd

Pandelis's picture

good move Draghi ... just keep it up.  in the words of our good NY senator ... go to work Mr. Draghi ...

new game's picture

what europeans don't know yet is the bankers are coming to take it all. it will be sad, first sovereignty, then dignity, then everything else. Greece baby greece. and here in am in fed land calling the kettle black, same fucking problem different details. 50 states with their hand out for something from the almighty giver of fiat, grants, funding, you name it; it's called dependence...

only differnce is gov.org structure and 500million arms.

Squid-puppets a-go-go's picture

so after those 5 smackdowns, whats the paper/phys ratio now?   Are we over 1000 yet?

Tejano's picture

Pretty darned high, I'm sure.

 

 

 Thanks, Tyler for the term "Whammy Slams"! I had not seen that before. I like it. Whammy Slams.

 

Futile and foolish, but Whammy Slams nonetheless.

 

 

Slomotrainwreck's picture

Gold Soars As ...

You get nothing!

Actually, I got mine.

E.F. Mutton's picture

Wow, talk about Synchronicity - when I saw the last minute BS ramp up to the close, my first thought was the line from "The Angels Wanna Wear My Red Shoes" by EC

"Oh I used to be disgusted
and now I try to be amused"

Keltner Channel Surf's picture

Good man.  For some reason, whenever temps get above 60 here in the Midwest, I get a yen to hear older Elvis C stuff.

Budnacho's picture

Costell and Joe Jackson are Springtime Favs in the `nacho household....

 

Just wrapping up the winter Pink Floyd marathons....

Keltner Channel Surf's picture

Yeah, something about birds singing and flowers budding that makes "Echoes" and "One of These Days" somewhat less palatable  :)

Squid-puppets a-go-go's picture

i got a 5 yr old son who is autistic and a musical savant

last night he listened to led zeppelins ramble on 50 times in a row. Drives me nuts but the kids got great taste...

 

Keltner Channel Surf's picture

Can't blame him, I actually got that album for Christmas in the second grade (no kidding, we had reel-to-reel home movies documenting my holding up the dirigible cover), and I always repeated that track 3-4 times before flipping to the other side.

You can look for my parody of "Thank You" from that album in the coming weeks, whenever AMZN pops higher (I somehow twisted it into a AMZN love song).

Squid-puppets a-go-go's picture

lol i will look out for that

back in the vinyl days, my brother was 18 months old when that record came out. he demanded dad teach him how to put a record on, dad said ok but if you ever scratch one, never again. He never scratched a record. 2 year old listening to immigrant son with headphones on.

That cat grew up to be a lead singer in a Zeppelin cover band. Hard ask for any singer.

BarkingCat's picture

"Ask"  is a verb not a fucking noun.

 

E.F. Mutton's picture

When I was 14, my Mom actually said if I played "Heartbreaker" one more %$#! time...

BeaverCream's picture

Good thing you got him vaccinated.  Now he can really focus on led zeppelin.

mandalou's picture

What the fuck is wrong with you?

Good job being douche of the day.

Squid-puppets a-go-go's picture

its cool, this is fite club

Im not convinced of the vaccination theory. Autism symproms only show when the brain is trying to execute more sophisticated functions - for some mysterious reason they often seem ahead of their peers at 1 year old, then at 18 months go into a regression. That just happens to coincide with vaccination timelines.

My kid was extreme premmy. 24 weeker. Thats more likely to have been the causal effect.

TheSkipper1967's picture

This will go over like a lead balloon.

Traderone's picture

Thank God you got in before the tin hat brigade. 'stoopid freakin' shitshow with those stoopid motherfuckers rampin' this piece of shit into the close and takin' my hard earned money away from me (again), DEATH TO THER PHONECHARGERS.

Keltner Channel Surf's picture

I'll even put my rebuttal above him:

The lows actually came just after 1:00 in all indices, a common reversal time, and corresponded to the penny (bold for emphasis) in all indices (save the Dow, which reversed slightly above) to the following key technical levels familiar to all traders, in some cases multiple levels in conjunction (i.e., even more machines waiting), suggesting it was automated algos and NOT a Fed conspiracy:

QQQ:  Daily 50MA/20EMA, Weekly 100MA
SPY:  Daily forward 20MA, 2.5% volatility band off of 200DMA, Weekly 20EMA
IWM:  Daily forward 20MA, Weekly 200MA
DOW:  just above:   Daily forward 20MA, Weekly 20EMA

mandalou's picture

I tired NQ today for the hell of it around euro close and took a loss. Figures as I got algo'd. It was very apparent reading the tape. I picked the right way just played to tight. 

Crude missed my limits all day but strategy was projecting every swing. Entry was either missed or not filled. Oh well still a decent week. One more day then off next week for OPEX and rollover.Hope you had a good one.

Keltner Channel Surf's picture

Like insurance sales, this profession depends on handling rejection :)  Still, you've been on a roll in a whipsawing commodity, kudos. 

I got about 1% today on a very tough RUT trading day, I didn't like what I was seeing, so I traded smaller posns, was hoping for a bigger late day breach that never came.  Even so, my only loss was an early "pre-technicals" short, then two nice gains.

Kuroda and Yellen could make for more thin tape crap, perhaps by May the machines will get out of wait-and-see mode ... just in time for low vacation liquidity.  You can't win, but it's sure fun trying (actually I'm more optimistic on a tradable year post-Draghi).

mandalou's picture

Good job!!! It is hard to stomach a loss to start the day as emotions can take over. You stuck with your plan and it paid off.

 

GDTRFB1's picture

Loaded up on uvxy few days ago we'll see how that plays out. Somehow feel like this will go on another 100 yrs, bangin my head against the wall.

GDTRFB1's picture

Loaded up on uvxy few days ago we'll see how that plays out. Somehow feel like this will go on another 100 yrs, bangin my head against the wall.

SPONGE's picture

Wow! Actual trading talk.  Makes me miss the ZH of old.

SPONGE's picture

Actually, makes me miss the markets before they got all wonky.

Traderone's picture

Perhaps the internet in his mommy's basement was slow today which allowed you in ahead of him. :). 

The ES behaved very technically today with respect to the usual levels and as you said the 1 PM turnaround was well flagged. Bring on tomorrow is what I say. 

 

Keltner Channel Surf's picture

I'm glad you rescinded your planned retirement from these after-market boards, otherwise it'll be just angry "savers" left, and while everyone has a right to speak, it would be like a Trump debate without Kasich, a bit one-sided ... one could argue the juxtaposition makes each side come across more clearly ...

Traderone's picture

Alas KCS my contributions will be sparse and probably only in response to comments  from your good self .Hope that's OK. God bless you my friend.

new game's picture

check back when you have lost it all. i have no idea how i would trade this market cept to have a hedge for every trade and hope to break even less fees. good luck though...

Soul Glow's picture

Traderone!  Everything is fucking awesome dude!  Draghi increased his Euro QE to $1T over the next year, Japan has gone full NIRP, and ARRA doesn't stop until 2018, never mind whatever buying programs the ESF is doing in exchang with the PPT!

UE - 3 is at a low because boomers are retiring in droves, which sucks liquidity out of the system via 401k cashouts, and they spend it on eating out, which means the only jobs created in their abscence are part time waiters and bartenders, and those are the best jobs in the world because they require a high level of skill and an increased pay grade.  Jobs people can have and build their careers on, you know?

Everything is awesome dude so we don't need you raining on our unicorn piss parade!

Kaiser Sousa's picture

Soul -

you must be broke like me from all those terrible "trades" you made....dont lie i can see your finances thru this internet thing....

 

new game's picture

for the record, i was down big bout ten years ago, got it back mainly by china explosion-lith ion ect rev schells, ethenol, solar, oil, mining. left and never looked back cept to give people shit on this blog, lol. so never take my shit to awfully seriously. nsa spying could make me an awesome trader, ha...

game is rigged to beat an insider, pretty tough game to win at...

Traderone's picture

Hi SG. I am not American so therefore have no personal attachment to your stock market. I am simply a daytrader of the ES who trades what he sees and not what he thinks. If you want to engage me in conversation about said markets then I'm all ears. Thank you. 

LordBuckFast's picture

The truth is there will be no real worldwide recovery ever and the insane bubbles that have been inflating around the world, just reflect this, because virtually everything we are being fed is pure BS!

But unfortunately for us the elite do not give a damn, as they will soon be looking to run and hide in those nice underground bunkers paid for with citizens taxes, after engineering a full economic collapse as well as starting WW3, plus they will make sure that there are enough Jihadi’s in the West to start a race war. 

That should be enough to cover up the failed fiat ponzi scheme and take care of the ‘excessive’ population! 


The agenda is clear......

 

http://beforeitsnews.com/conspiracy-theories/2015/12/as-events-spiral-ou...

 

Kaiser Sousa's picture

Lets review:
*at exactly 1:00 pm New Dork time, and after the Dow had relinquished the opening pump on Draghis’ bullshit impotency policy press conference, it stood down 178 points thru 4 hours of trading...

*The Dow Jones Propaganda Index then suddenly ramped erasing almost 100 points of losses on no relevant news or data WHATSOFUCKING EVER...

*THEN AS I HAVE POINTED OUT DAY AFTER FUCKING DAY THE FED AND THE ESF IMPLEMENTED HALODECK PROGRAM “RETAIL INVESTORS RUSH IN TO BUY STAWKS IN THE LAST 2 HOURS OF TRADING IN NEW DORK” TO LAUNCH THE FRAUDULENT FUCKING FRAUD MARKETS OFF THEIR LOWS YET AGAIN ON NO CORRELATING NEWS OR DATA WHATSOFUCKING EVER…

"HEY MOTHER FUCKERS LOOK. WE ALMOST PARKED IT RIGHT BACK AT 17,000 AGAIN LIKE YESTERDAY. HA, HA!" - The Fed.
http://www.marketwatch.com/investing/index/djia

*OH, AND WHAT ABOUT THE PHONY PAPER PRICES OF THE ONLY 2 FORMS OF REAL MONEY RIGHT BEFORE  -
http://www.kitco.com/charts/livegold.html

AND RIGHT AFTER THE FUCKING CRIMEX CLOSED???
http://www.livecharts.co.uk/MarketCharts/gold.php

THERE WERE ’2’ 20 MINUTE DUMPS OF IMAGAINARY GOLD ERASING ALL THE GAINS OF THE DAY, PARKING IT BELOW THEIR LINE IN THE SAND $1270, AND ATTEMPTING TO FORCE IT TO SETTLE AT THE SAME EXACT PRICE IT SETTLED YESTERDAY - $1267… THEY CANT HAVE GOLD AND SILVER TESTING NEW HIGHS WHILE THEIR FRAUDULENT FUCKING DEBT BASED CURRENCY SHIT SHOW FLAT LINES... NOW CAN THEY?
 
ARE THEY ANYMORE DOUBTERS OUT THERE REGARDING THESE RIGGED FUCKING MANIPULATED NON-EXISTENT FUCKING MARKETS???? IF SO U R FULL OF SHIT….

© DEATH TO THE MONEYCHANGERS  

skinwalker's picture

I greatly envy you. I've always wanted a hernia. 

Kaiser Sousa's picture

CHEER UP CAUSE IT AINT STOPPIN TIL THE CURRENCY COLLAPSE IS COMPLETE IN 1-2 YEARS.

 

Keltner Channel Surf's picture

Thanks, Kaiser, for making clear the key issue some may have with your daily exegesis:  by recommending the bulk of one’s savings be in metals, you’re essentially buying a deep out-of-the-money call option on financial collapse but (I’d argue) with no knowledge of expiration date or implied volatility.  Thus, no one will give you more than the “phony paper price” currently, you’re counting on the debasement of the currency to progress such that a) the “phony” price rises astronomically; then b) it becomes invaluable as the only store of value and means of exchange.  You’ve finally given us a ‘precise’ forecast:  12-24 months from now.

Here’s the problem for many of us:  you admit little knowledge of markets and can't forecast the price of your beloved metals from month to month, and therefore our confidence in your larger forecast of complete societal collapse is, I’m sad to say, rather low.  You might be surprised to learn that, while many ‘traders’ here agree COMPLETELY with your opinion of central bank meddling, we have an honest difference with you on the degree of, and timing of, the collateral damage.

In fact, one could argue the environment could remain more deflationary with respect to commodities for a decade or more, which could push that damn ‘phony’ price much lower.  Even if some inflation or other gold-boosting European collapse occurs, some 'experts' expect a 50% Dow correction and a 2-3 year recession before a return to slow growth, eventually putting gold back below current levels.   I’m not making a forecast, only saying that despite these silly bankers, history can’t always be a precise guide to the collapse of complex, modern systems, which many devoted ZH-ers have been expecting for decades.   Thus, I don’t differ with you in spirit, only in timing, and the fact that an extreme-tail event isn’t something one should devote 100% planning toward.

On a lighter note, I wonder if you’re a music fan and what you listen to, perhaps Charlie Parker, early Sixties girl groups, Philip Glass operas, Faure nocturnes or the Floyd and Zeppelin mentioned above? 

AdolfSchicklgruber's picture
AdolfSchicklgruber (not verified) Keltner Channel Surf Mar 10, 2016 7:01 PM

Pretty brilliant response, and sometimes Kaiser is the highlight of my day. Have you seen Niall Ferguson's piece in Foreign Affairs on "Complexity and Collapse"? Very much in line with what you say here

Keltner Channel Surf's picture

No, but thanks for the tip, I'll look for it.

Kaiser Sousa's picture

cheer up...buy physical Gold...

if ifs out of your range then by lots of physical Silver...

u got 5 thousands years of history on your side.