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Broken Market Chronicles: Algos Gone Autosell Wild - Video Explanation Of What Happened

Tyler Durden's picture


Still scratching your head over what happened this morning (this would be everyone at the SEC but not their porn webstream vendors - even they by now realize just how broken the market is)? Don't be  - courtesy of Dennis Dick and Premarket Info, here is a 20 minute video explanation parsing the tape and showing precisely what happened that impacted nearly 150 stocks.

In summary:

  • Rogue algo strikes number of stocks: up to 148 symbols impacted
  • WFC preferred security JWF trades 4.9MM shares, and trades down more than 10%
  • VZ, PEP, RSH, BBY, WFC and many more all affected
  • Appears to be an auto buy program error on some issues
  • An auto-sell program on other issues

And since nobody at the SEC will move a finger to fix what we have been pounding the table on since April 2009, we can only hope that we get more and more increasingly more ridiculous market swings such as this one which will finally get absolutely everyone out of the markets. Even the vacuum tubes.

And for those curious, here is the list of 140 stocks that were BATSed, straight from the NYSE.

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Wed, 08/01/2012 - 12:02 | 2668996 malikai
malikai's picture

$5 says PPT is holding up SP right now.

Wed, 08/01/2012 - 12:04 | 2669008 overbet
overbet's picture

Just watch KCG stock price to know if they are gonna bust or not. Its a good hedge

Wed, 08/01/2012 - 12:18 | 2669087 Precious
Precious's picture

The County Coroner has examined the corpse and it is indeed dead. 

Wed, 08/01/2012 - 12:22 | 2669105 The Big Ching-aso
The Big Ching-aso's picture



Is there an Egyptian involved & has it been violated?

Wed, 08/01/2012 - 12:24 | 2669111 notbot
notbot's picture

Love the parting comment: "Don't use stop orders, that's the moral of the story"

Wed, 08/01/2012 - 12:31 | 2669133 lineskis
lineskis's picture

Ah, those summer interns... You've got to love'em... xD

Wed, 08/01/2012 - 12:52 | 2669210 Tippoo Sultan
Tippoo Sultan's picture

"...here is the list of the 140 stocks..."

Manchester United isn't on that list ?

Wed, 08/01/2012 - 14:36 | 2669699 LFMayor
LFMayor's picture

Islam means Piece.

Wed, 08/01/2012 - 12:25 | 2669116 slaughterer
slaughterer's picture

With the help of KCG, good day to start shorting WFC. WFC stock will never get beyond $35.  

Wed, 08/01/2012 - 12:03 | 2669003 vinu02
vinu02's picture

Its low volume rally look at this chart http://www.freefdawatchlist.com/p/stock-chart-analysis.html 

Wed, 08/01/2012 - 12:04 | 2669005 LawsofPhysics
LawsofPhysics's picture

Selling to be outlawed in 3...2...1...

Wed, 08/01/2012 - 12:05 | 2669010 RobotTrader
RobotTrader's picture

Maybe Bernanke suffered "premature ejaculation" today prior to the FOMC, by attempting to blow Wells Fargo shorts out of the water and trigger a runaway breakout in some key financial names.

Or maybe this is a warmup for some type of "shock and awe" intervention, so that Bernanke doesn't get embarrassed by a 3rd market selloff after his "Pie Hole" comments emerge during the FOMC chatter.

Wed, 08/01/2012 - 12:06 | 2669024 slaughterer
slaughterer's picture

Robo, was that you "putting the boner to" GMCR just a few minutes ago?

Wed, 08/01/2012 - 13:08 | 2669282 alien-IQ
alien-IQ's picture

he's a catcher, not a pitcher.

Wed, 08/01/2012 - 12:05 | 2669012 Jlmadyson
Jlmadyson's picture

Flashy crashy baby!

Wed, 08/01/2012 - 12:14 | 2669068 cowdiddly
cowdiddly's picture

Ah. Stuxnet comes home.

Wed, 08/01/2012 - 13:51 | 2669429 mendigo
mendigo's picture

Those charts looked like bot love-making.
Wore me out thinking about it.

Wed, 08/01/2012 - 12:05 | 2669016 PicassoInActions
PicassoInActions's picture

android vs IOS while Samsung is copying.... the algoritm for copying messed up all those stocks.

Wed, 08/01/2012 - 12:05 | 2669017 MsCreant
MsCreant's picture

When algos go wild, that means they show their boobs, right?

Wed, 08/01/2012 - 12:09 | 2669041 nonclaim
nonclaim's picture

They show the boobies at SEC, no less.

Wed, 08/01/2012 - 12:24 | 2669101 MsCreant
MsCreant's picture

Must be Mardi Gras. Boobs everywhere!

Wed, 08/01/2012 - 13:33 | 2669360 RockyRacoon
RockyRacoon's picture

This is a special occasion.  No regular old beads -- a string of pearls.

Wed, 08/01/2012 - 12:06 | 2669019 Hype Alert
Hype Alert's picture

Rogue = exposes the gig and brings too much focus.

Wed, 08/01/2012 - 12:06 | 2669021 Ralph Spoilsport
Ralph Spoilsport's picture

Too many "tech glitches" Bitchez. Something's up.

Wed, 08/01/2012 - 12:15 | 2669070 Hype Alert
Hype Alert's picture

Yes, it's a rigged market.  It can't get any more obvious.

Wed, 08/01/2012 - 12:08 | 2669026 optimator
optimator's picture


Wed, 08/01/2012 - 12:09 | 2669038 LawsofPhysics
LawsofPhysics's picture

make sure you hold physical assets of real value and actual know the real value of your labor?  Turning japanese indeed.

Wed, 08/01/2012 - 12:12 | 2669059 francis_sawyer
francis_sawyer's picture

My services as a web page designer for pet grooming salons is sure to command top dollar in the new paradigm...

Wed, 08/01/2012 - 12:08 | 2669033 insanelysane
insanelysane's picture

MSM is saying only a few stock symbols.

 Nothing to see here.  Move along.

Wed, 08/01/2012 - 12:08 | 2669035 bob_dabolina
bob_dabolina's picture

Some people on ZH says this is good. No BS.

Wed, 08/01/2012 - 12:08 | 2669036 Benjamin Glutton
Benjamin Glutton's picture

Algo mulligan bitchez!

Wed, 08/01/2012 - 12:18 | 2669083 Hunter S. Thompson
Hunter S. Thompson's picture

Made a trading mistake, thats okay Algos get a do-over

Wed, 08/01/2012 - 12:18 | 2669085 Hunter S. Thompson
Hunter S. Thompson's picture

Made a trading mistake, thats okay Algos get a do-over

Wed, 08/01/2012 - 12:20 | 2669098 The Big Ching-aso
The Big Ching-aso's picture



Fyi.   You're only allowed 2 posting do-overs.

Wed, 08/01/2012 - 12:45 | 2669190 FoxMulder
FoxMulder's picture

I'm gonna go get the papers, get the papers.

Wed, 08/01/2012 - 12:09 | 2669042 francis_sawyer
francis_sawyer's picture

It's just a little after dinner mint...

Wed, 08/01/2012 - 12:10 | 2669050 ericfoster3
ericfoster3's picture

is this what it looks like when two algos go head to head against each other?  Can't wait for the Algo Battle Royale, only on pay per view!

Wed, 08/01/2012 - 12:14 | 2669053 Money 4 Nothing
Money 4 Nothing's picture

My best Tommy Boy impression...

"Unplug the Godamn thing!! For the love of Christ!!"

Wed, 08/01/2012 - 12:12 | 2669056 Nid
Nid's picture

Presumably, the algo-master was not previously long 3 million shares of AWF...so once again, a clear example of Naked Short Selling (illegal).... which of course, doesn't actually exist and is just a paranoid delusion.

Wed, 08/01/2012 - 12:56 | 2669230 Captain Benny
Captain Benny's picture

Agreed - I highly doubt the seller even had the shares to sell such a quantity.  I highly doubt they preborrowed that amount either.

Now we also must question -- Who the hell would jump in and backstop that trade with that quantity of buy orders?  No market maker will back AWF that much -- its way too much risk on their books.  This whole thing is a fraud.

Wed, 08/01/2012 - 12:12 | 2669058 JustObserving
JustObserving's picture

Bring back the Uptick rule.  But since the SEC is owned by the algo trading firms, it will never happen.  

This sustained selling is a regular feature of the silver and gold manipulation.

Wed, 08/01/2012 - 12:17 | 2669077 LawsofPhysics
LawsofPhysics's picture

We have a winner!  PMs have been bad, they must be punished.  Moreover, commodities also need to be suppressed. 

Wed, 08/01/2012 - 12:14 | 2669067 slewie the pi-rat
slewie the pi-rat's picture


one can only hope it is only another episode of: theChroniclesOfTheShitfacedGolfer/Traderz

Wed, 08/01/2012 - 12:15 | 2669071 Rainman
Rainman's picture

SEC is throwing in the towel on money fund reforms. Little guys beware of your cash...big guys will be out at a buck before shtf


Wed, 08/01/2012 - 12:40 | 2669168 onebir
onebir's picture

Hey, anything else is socialism (<-Tyler)...

Wed, 08/01/2012 - 12:16 | 2669076 Turin Turambar
Turin Turambar's picture

Hmmm, sounds like it's time for the market to break to the UPside again.  ;-)  LOL, what a joke.

Wed, 08/01/2012 - 12:17 | 2669079 slewie the pi-rat
slewie the pi-rat's picture

it's brianSack test-driving his new fuking 'edsel'?

Wed, 08/01/2012 - 12:17 | 2669082 Dr. Engali
Dr. Engali's picture

It will be interesting to see who gets Corzined In this mess

Wed, 08/01/2012 - 12:19 | 2669084 The Big Ching-aso
The Big Ching-aso's picture



Relief. We know they know what's causing these problems.  Now back 2 the Olympic Badminton results....

Wed, 08/01/2012 - 12:19 | 2669093 Jake88
Jake88's picture

What no names? Are we protecting the innocent?

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