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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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?

saturn's picture

Bruno = Scape, Iksil = Goat.

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!!

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.

francis_sawyer's picture

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

the 300000000th percent's picture

awesome post, i think you meant fibonacci ratios

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....

Badabing's picture

A hypothetical answer to your hypothetical post

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

 

dick

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.

JimBowie1958's picture

So they BARTER, dude!

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

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.

Bohm Squad's picture

+1

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

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...

http://www.aztecura.com/php/data/test.php

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

Bringin It's picture

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

SheepDog-One's picture

Right theres only ever a problem if indexes went down.

French Frog's picture

Why would they correct the trade?

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

bonddude's picture

Put that mutt in the error account son !

larz's picture

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

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?"

Lazlo Toth's picture

+1 Steel Panther reference.

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.

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.

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.

vast-dom's picture

BREAKING NEWS 8/10/12: BERNANKE IN PRIVATE MEETINGS WITH HFT FIRMS TO CONTINUE TO LEVITATE MARKETS UP IN NEW TWIST AWAY FROM OUTRIGHT QE.

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.

Shizzmoney's picture

In short:

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

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.

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!

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.

Bohm Squad's picture

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

vast-dom's picture

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

youngman's picture

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

Tsar Pointless's picture

0001110101 0011110011001 100011 1100011000!

That's when.

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..

Dr. Engali's picture

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

Dr. Engali's picture

Ben your finger prints are all over this market.

Cognitive Dissonance's picture

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

Ouch

RockyRacoon's picture

Hey, CD!  Great image.

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

Cognitive Dissonance's picture

The futility of commenting about market futility is becoming......er.....futile?

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.

saturn's picture

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

cosmictrainwreck's picture

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