How Two Trades In Half An Hour Make Market Go Boom... And Unboom

Tyler Durden's picture


What's the point in commenting any more: when two discrete trades manage a nearly 1% cumulative roundtrip move in the entire market, all we can say is "good luck human" - the whale on the other side of "that" trade is far bigger than Bruno Iksil. And good luck when you need liquidity once the selling returns. The discount to the bid will be far, far more than the 5% it cost Knight to unwind its error book to Goldman.

From Nanex:

15,000 eMinis Make Market go Boom

Starting at 11:04:55 and lasting for 3 seconds, approximately 15,000 eMini contracts traded, causing a significant market disruption. At the same time, approximately $100 Million worth of SPY traded.


eMini Depth of book takes a big hit. The area circled shows a sudden drop in liquidity as a result of the sudden trade.
August 10, 2012 is the thick red line, updated to where it goes horizontal.

At 11:26:21, another 8,000 eMini contracts trade in 1 second, sending the market back up. At the same time, approximately $53 Million worth of SPY traded.

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Fri, 08/10/2012 - 12:02 | 2694294 CalibratedConfidence
CalibratedConfidence's picture

same shit new day

Fri, 08/10/2012 - 12:06 | 2694308 malikai
malikai's picture

So, if it's a fat finger when the market goes down, what do you call it when the market goes up?

Fri, 08/10/2012 - 12:14 | 2694331 Temporalist
Temporalist's picture

The middle finger

Fri, 08/10/2012 - 12:21 | 2694357 saturn
saturn's picture

Bruno = Scape, Iksil = Goat.

Fri, 08/10/2012 - 12:28 | 2694386 Badabing
Badabing's picture

After doing a thorough analysis using OHLC charts overlaying Elliott wave principle, Fabonacci ratios, momentum rate, the 200 and 50 DMA, and resistance break out trending I have come to the conclusion that the in-depth analyses just preformed is for SHIT because the market is counterfeit!

buy phys. PMs

fuck you banks!!

Fri, 08/10/2012 - 12:40 | 2694412 Hype Alert
Hype Alert's picture

So the question is, whoever (*cough* *cough*) is "Buying" this market up, how long can they keep it up because without a printer in their basement, no one can keep that up.

Let's see, Knight was able to buy the stocks down without a margin account and got caught simply because the algo ran away. I guess as someone without margin requirements, you can buy the market any way you want.

Fri, 08/10/2012 - 13:46 | 2694618 francis_sawyer
francis_sawyer's picture

Elliott [Idiot] Wavers will be along to explain all this in 5...4...3...2...

Fri, 08/10/2012 - 12:57 | 2694452 the 300000000th...
the 300000000th percent's picture

awesome post, i think you meant fibonacci ratios

Fri, 08/10/2012 - 13:43 | 2694608 Badabing
Badabing's picture

yes i did and thanks

Fri, 08/10/2012 - 13:27 | 2694531 HarryM
HarryM's picture

Can VIX go negative?

Fri, 08/10/2012 - 13:36 | 2694576 hannah
hannah's picture

BUY PM's then have a BM when you lose all your money when the gov confiscates your gold.......


BUY phys. frying pans....

Fri, 08/10/2012 - 13:46 | 2694624 Badabing
Badabing's picture

A hypothetical answer to your hypothetical post

Don’t buy Phys. PMs and miss the party to the moon



Fri, 08/10/2012 - 14:03 | 2694694 Temporalist
Temporalist's picture

Here is a little story:

A couple decides to try to protect their money by buying hard assets to protect against global monetary debasement.  They think that people will always need to eat so they invest in frying pans.  When finally the day comes they have stockpiled a garage and basement full of 10,000 frying pans.  They open a shop and find there is a problem: everyone that wants a frying pan can't afford gas or electricity to cook with.

Fri, 08/10/2012 - 17:12 | 2695376 JimBowie1958
JimBowie1958's picture

So they BARTER, dude!

That is where we are heading for a short time; barter and bullets.

Fri, 08/10/2012 - 19:41 | 2695764 hannah
hannah's picture

DOES ANYONE NEED AN EXAMPLE OF THE LIMITED ABILITY FOR PEOPLE TODAY TO THINK.... well this is it.temporalist is the poster child.

Fri, 08/10/2012 - 19:20 | 2695716 Bohm Squad
Bohm Squad's picture


Everytime I hear about Elliot waves, I throw up just a little in my mouth ( taco...see?).

Fri, 08/10/2012 - 20:26 | 2695830 tbone654
tbone654's picture

I'm not an Elliot waver... but Jesse Livermore wrote books about the same effect...  And I'm amazed at how accurate his method has been lately...  3% correction, then bounce a little, 3% up, then react a little...  Every time it hits a 3% move, you watch it to see how it handles 3% level and trade accordingly... 

complain all you want about something you don't understand, but when it comes right down to it...  it's about whatever it takes to make money...

just keep looking at the green and red columns on the right...  those change back and forth over 3% corrections...  (aka waves)

Fri, 08/10/2012 - 21:23 | 2695955 Bringin It
Bringin It's picture

Maybe the HFT algo programmer or Ben Shalom read the same Jesse Livermore books?

Fri, 08/10/2012 - 12:15 | 2694335 SheepDog-One
SheepDog-One's picture

Right theres only ever a problem if indexes went down.

Fri, 08/10/2012 - 12:16 | 2694340 Nadaclue
Nadaclue's picture

Correcting the trade?

Fri, 08/10/2012 - 12:32 | 2694396 French Frog
French Frog's picture

Why would they correct the trade?

Is it suddenly illegal to sell 15000 e-mini contracts at the same time?

Fri, 08/10/2012 - 12:51 | 2694440 bonddude
bonddude's picture

Put that mutt in the error account son !

Fri, 08/10/2012 - 12:28 | 2694383 larz
larz's picture

Nothing to see hear I just sat on my keyboard move along

Fri, 08/10/2012 - 12:29 | 2694389 WhyDoesItHurtWh...
WhyDoesItHurtWhen iPee's picture

Smell my finger.

Fri, 08/10/2012 - 13:59 | 2694683 pods
pods's picture

The Shocker?

"So, if it's a fat finger when the market goes down, what do you call it when the market goes up?"

Fri, 08/10/2012 - 22:59 | 2696202 Lazlo Toth
Lazlo Toth's picture

+1 Steel Panther reference.

Fri, 08/10/2012 - 12:18 | 2694350 AccreditedEYE
AccreditedEYE's picture

Question is, at WHAT point and, more importantly, WHAT AMOUNT OF MONEY do people start waking up and getting f-ing nervous? I'm still amazed people put $$$ into KCG... without knowing what really happened! Blackstone is not just another tool in the wood shed either... Just. Wow.

Fri, 08/10/2012 - 13:07 | 2694476 Joshua_D
Joshua_D's picture

People are already waking up. What you are talking about is "momentum," i.e. when does the snowball become an avalanche? Of course, that's hard to say, because it looks like snowball right up to the point that it is an avalanche.

Fri, 08/10/2012 - 14:04 | 2694714 Muppet Pimp
Muppet Pimp's picture

After TVIX broke people were poring money into it looking for a dead cat bounce.  As it turned out all they wound up with was a dead cat.

Fri, 08/10/2012 - 12:37 | 2694381 vast-dom
vast-dom's picture


Fri, 08/10/2012 - 12:33 | 2694397 MillionDollarBoner_
MillionDollarBoner_'s picture

Deja poo

Same shit, different day

Fri, 08/10/2012 - 12:04 | 2694298 govttrader
govttrader's picture

go go VWAP...go go VWAP...yeah!!!!

Fri, 08/10/2012 - 12:15 | 2694336 CrashisOptimistic
CrashisOptimistic's picture

Look, guys.

It's very hard to accept that what you have looked at for decades is gone, but it is.  There is no longer a market.  

Just forget it.  Don't have money in it.  Ever again.  It's all over.  It's never going back to what it was.  

If you're in the market, you're not trading.  You're not investing.  You're betting.

Get your money out and buy farmland and find a farmer to sharecrop farm it for you.  It's all you can do now.

Fri, 08/10/2012 - 12:21 | 2694359 Shizzmoney
Shizzmoney's picture

In short:

"Neo.....there *is* no Market"

Fri, 08/10/2012 - 12:27 | 2694378 Hype Alert
Hype Alert's picture

I have a friend that is at a county auction right now that is doing exactly what you talk about.  This "market" is just a sick joke now.

Fri, 08/10/2012 - 13:23 | 2694520 walküre
walküre's picture

I accept a barter of your farm labor for my food. We got corn, potatoes, cabbages, carrots, onions, lettuce, peas .. and on the other side of the fence some nice hogs or lambs or beef. Plenty of work around here. Room for cottages also. Water is plenty and the barn parties are fun!

Fri, 08/10/2012 - 13:43 | 2694606 CrashisOptimistic
CrashisOptimistic's picture

Lots of people will say  . . . I don't know how to farm.  I spent my life doing other things.  I'm not a farmer.

Well, folks, in the post Peak world, farmers don't know how to farm.  You are on a level playing field if you're competing.  They don't know how to grow without insecticide, fertilizer or tractors, either.

Fri, 08/10/2012 - 23:02 | 2695983 Bringin It
Bringin It's picture


Fri, 08/10/2012 - 19:23 | 2695723 Bohm Squad
Bohm Squad's picture

Just saw an ad for binary options...thought, "Wow.  Me v. HFT...think I'll pass."

Fri, 08/10/2012 - 12:05 | 2694299 vast-dom
vast-dom's picture

POST VIDS OF THIS BULLSHIT PLS! I like to watch (the mess go apeshit). 

Fri, 08/10/2012 - 12:06 | 2694304 youngman
youngman's picture

I wonder when the commentators on TV will start talking in Bit code...111100111001101100011001011100100010010100101

Fri, 08/10/2012 - 12:08 | 2694311 Tsar Pointless
Tsar Pointless's picture

0001110101 0011110011001 100011 1100011000!

That's when.

Fri, 08/10/2012 - 12:28 | 2694384 Manthong
Manthong's picture

That's only like a 4.5 on the San Andreas..

but you might want to pay attention to a bunch of them in a row.  Hmm..

Fri, 08/10/2012 - 12:08 | 2694306 Dr. Engali
Dr. Engali's picture

Delete..double post..because my adhd kicked in.

Fri, 08/10/2012 - 12:06 | 2694307 Dr. Engali
Dr. Engali's picture

Ben your finger prints are all over this market.

Fri, 08/10/2012 - 12:07 | 2694309 Cognitive Dissonance
Cognitive Dissonance's picture

That was just a small asteroid impact. Wait until the big stuff rains down.


Fri, 08/10/2012 - 12:12 | 2694326 RockyRacoon
RockyRacoon's picture

Hey, CD!  Great image.

I think the first few words tell the story:   What's the point in commenting any more....

Fri, 08/10/2012 - 12:19 | 2694345 Cognitive Dissonance
Cognitive Dissonance's picture

The futility of commenting about market futility is

Exhaustion has settled in. Desperation will soon follow, for both observers and participants. The conclusion to these long period cycles kill everyone not securely strapped in.

Fri, 08/10/2012 - 12:22 | 2694363 saturn
saturn's picture

Is the asteroid leaving the Earth or impacting it? I cannot decide.

Fri, 08/10/2012 - 12:30 | 2694392 cosmictrainwreck
cosmictrainwreck's picture

agreed.... "depends on how ya look at it" *snark*

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