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ES Closes Below 200DMA After 4% Rally Off Overnight Lows
Amid average volume, ES managed to rally an impressive 45pts off overnight lows to close just shy of the 200DMA on what was mixed (at best) macro data in the US and seemingly more chaos in Europe (does anyone know for sure whether there will be a confidence vote?). High beta and most-shorted stocks dramatically outperformed the broad equity markets as 4% swing days have become so de-rigeur nowadays! Financials went from major loser soon after the open to middle of the pack by the close with only a very late day disconnect between HY credit and stocks (HY outperformed after the bell) of any note as we leaked higher all day long. Heavy new issuance in IG credit saw secondary bond trading pretty balanced from a net-buying/selling perspective - even as TSY yields rose significantly. TSYs saw 2s10s30s rise notably but combined with FX carry crosses, oil, gold, and the dollar - risk asset drivers in general were far less excited than stocks by the close. Commodities lifted further after Europe's close as the USD weakened more leaving gold and oil up around 1.5% on the day.
Stocks and credit tracked each other almost perfectly all day (the dip in HY was bad data) with a very modest contraction in stocks into the close as we pulled back from the 200DMA and HY tracked better into the close. We did see HY3s5s flatter (bull flatteners) so some technical compression and index arb on HY 5Y may have helped as we note HY intrinsics did not rally anything like this much.
The purple line above is the 200DMA and we stalled at that line as resistance today. Volume was at the 50-day average and average trade size was well above average - with heavy volume at or around the close perhaps suggesting professionals covering. For sure, today saw high beta names being grabbed in a hurry (potentially supporting the chase for performance concept touted in the MSM). The chart below shows Goldman's high beta index managed greater than 3% gain today relative to the S&P at only 1.88%.
And furthermore, there was a definite squeeze feel (once again) as Goldman's index of the most shorted names in the Russell also outperformed rather significantly - up 2.9% vs Russell's +1.96%:
Away from stocks, Gold was #winning on the week, managed to get above $1760 to gain just over 1% this week - even as the dollar is over 2% stronger on the week. Note how oil and gold look coupled as do silver and copper this week.
All-in-all, a rather uneventful day considering the massive ramp in stocks with little of note other than risk-on. Perhaps of note is the steepening in the front-end of the vol curve (1mo to 3mo) which often presages another vol spike but macro and micro protection in equities moved pretty well in sync as we rallied. Heading into tomorrow's NFP number it seemed more like squeeze day today as opposed to laying out too many new longs - though Greece did provide headlines that could be seen as net positive - though we are much more negative on the un-democratic escapades seeing only skeptical reasons for these shenanigans at this time.
Charts: Bloomberg
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Veterans protesting : Time for talking has passed
http://www.wnd.com/index.php?fa=PAGE.view&pageId=363221
Very bullish.
wait until our brilliant leaders cut their benefits.
WTF
WiND Bags?
Wow. That shit's better than The Onion.
dont worry about the price of gold or silver..
JP will continue to sell gold and silver to itself at a loss to drive the prices down!
YAY! more cheap tangibles for everyone while gutting the Treasury! YAYYYY!
No more day trading. Just night trading. That was fucking AWESOME
be alert
for one knows not the hour of the trade
45 pip rally...just another day in the broken markets. Must have been good ISM numbers
What qualifies as a flash crash again? That dump and re-pump this morning looks like it should qualify.
that was a test of the congestion but call it flash test if you want
While answering my own question I found it interesting to recall that around 5/6/10 the big news was Greek debt.
http://www.zerohedge.com/article/rip-euro-1999-2010
http://www.zerohedge.com/article/activity-ecbs-discount-window-jumps-greekman-brothers-redux
Groupon business model by CNBC
http://www.youtube.com/watch?v=tikRd_pTteo&feature=youtube_gdata_player
Standard CNBS Model of Explaining the Financial Universe (aside from proper application of the Heisenberg Uncertainty Principal) is to focus on the most irrelevant but possibly marginally interesting useless bit of information, blow it all out of proportion thereby propogating the illusion of All's Well.
Professionals covering their shorts. Pfft. That's not professional - that's amateur since they don't realize the huge payoff in staying short. Damn those momo folks.
IF the DJI hits 14k, they deserve what I invested in FAZ... but odds greatly favor 10k first than 14k..
now you are not going to get this, but the past few days the market has in fact traded like it should. on the open with high futures there was a sell off back to baseline (hourly) then going higher. the past three days it's traded the correct way. the worst is the high futures with an all day ramp of hft funds (who is buying that, then there is always a sell off in europe and asia as their futures are so much hugher they take a profit. honestly plot the trend lines hourly.
Really ? fundamentals and everything ? Not buying it (literally)
Pure guesswork. Throw your charts and graphs away, the market is moving on "news" and nothing more. To say its "trading like it should" implies there is a pattern- which other than a range, there is no pattern. But if you think you've got it figured out- do tell. Where will it be tomorrow? Yea, that's what I thought too.
dow at over 12,000, just 14 PERCENT off ALL TIME FRENZIED DEBT DRIVEN HOUSING INDUCED HIGHS BACK IN 2007!!!!!! FOURTEEN PERCENT, THATS IT!!!!!
somebody please tell me--WTF???????????????????????????????
<==== wtf is right, BiCheZ!
<==== kito is expressing his inner Robo & needs intervention!
WTF?
WTF?
I'll tell you WTF .
Market giving us a good chance to get short.
That, and it is priced in non inflation adjusted dollars.
I love the stock market. Its so fair.
And there's clowns too.
Bring your own popcorn though...
We are the 99%.
http://www.theinsidegeek.com/wp-content/uploads/2011/11/occupy.jpg
www.roadtoroota.com
http://www.youtube.com/watch?v=J659hiXiUbM
if i were the chairsatan, i would be printing demonically for tomorrow's "markets"
that 200 dma is a BiCh, BiCheZ!
The SPX may be ready for a sustained move lower. Gold appears ready to complete its correction lower. Also the USD looks very bullish across the board for the major currency pairs. Intermarket analysis is telling us that "risk off" is certainly coming, and likely very soon. http://bit.ly/u7t5rC
I think europeans found a perpetual something ... they can lower rates and still have their currency out perform ...