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Market Snapshot: Dow Jones Soars 400 Points On European Rescue Plan #42

Tyler Durden's picture




 

UPDATE: Moody's ITA downgrade took some shine off as EUR drops 60 pips and ES now 13pts off its highs. TSYs are 3-4bps lower in yields. Gold/Silver not moving much on it.

On the basis of old news, more promises, lack of any clarity, and Dexia's dump on the Belgian government, the equity markets staged a 4% rally in the last 45 minutes to end an incredible day. Our assumption is that this was simply the bounce that everyone expected as we seemed to have squeezed shorts into lunch and were limping back lower on AAPL disappointment. Quite clearly, there were a few uncomfortable equity shorts who were squeezed out rapidly and incessantly as the S&P massively outperformed credit as well as the broad basket of risk assets - even TSYs only managed to sell back to earlier day's high yields (as opposed to extending). Gold/Silver rallied (though well off week highs) as the USD dumped back near the week's lows and copper and oil rallied but again no where near as ebullient as stocks. Evidently, the equity move is exuberant at best but these squeezes seem able to maintain longer than anyone expects.

The clearest example of the exaggerated move in equities is probably against the broad-basket of risk assets known as CONTEXT which tracked very well all day but was simply unable to keep up with the covering in ES as we rallied. While it does not mean equities are absolutely expensive, it does imply there is a disconnect between risk appetites relatively speaking and would suggest equity weakness short-term (from our experience).

We had noted all day that credit was underperforming - and more noticeably that single-name credit was underperforming indices - suggesting forced long covering or horizon changes (from short to long) in macro to micro hedging. The indices in general did not initially follow ES but as the rally took hold they started to catch up (understandably so) but significantly underperformed ES as we closed.

AAPL was the story of the middle of the day as it failed to provide an iPhone 5 (all-singing-all-dancing awesomeness) and fell more than 5% at one point (testing its 200DMA) before ripping back higher to its VWAP and then a little more to close down around 0.6%. Once again - we have run out of adjectives to describe that kind of move in that market cap but whatever helped the market certainly saved a few hedge fund's years today!!

Sectorally, it is more what we would expect from a bounce day - the heavily shorted and prime-for-a-short-squeeze financials ripped almost 6.5% higher in that last 45 minutes. Amazingly, MS is now +3.25% from Friday's close, rallying 14.5% in the last 45 minutes with Goldman and Wells Fargo also making into the green on the week. In CDS land, MS opened 645/665 and closed 555/575 (still a little wider on close) in 5Y but 1Y remains 780/850 and was active today - moves in other financials were similar in style to MS (glide rally, jump wider early afternoon, then gap tighter into close) but lesser magnitude.

Enough of the superlatives...TSYs did not get quite as excited. 30Y did manage a 11bps rise in yields from today's low yields but was only just above the earlier high yields - significantly off the levels of yesterday still (as equities test them).

There was modest underperformance in the 5-7Y TSY bucket and that fits with the heaviest net-buying in corporate bond land today seen in the 3-7 and 7-12Y buckets respectively. For some perspective on the moves in the indices relative to single-names today IG was 0.5bps tighter while its fair-value widened 7.5bps (massively cheap to the index now) and HY managed a 1bps compression on the day (as opposed to 48bps decompression in intrinsics) but we do note that short-dated HY was wider all day. Just for further perspective the equity move today is equivlent to 37bps more compression in HY and 5.5bps compression in IG - another point of evidence that the rally was overdone (but that's optically clear we assume).

FX saw the USD dump as AUD ripped higher as did every other major (apart from JPY) as carry FX took off - it was initially delayed in its response but once we got going in ES it didn't take long to rip.

Precious metals and commodities all managed to rally back as the dollar lost ground with oil finding the day's highs but copper, gold, and silver all stayed well of the earlier day's highs. Silver clung to $30 at the close as oil peaked over $78.

All-in-all - an unbelievable last 45 minutes to what was making sense as a day so far with Bernanke's perspective early on. While we would prefer to fade this equity strength, we would suggest a half/third unit size as these squeezes can extend incredibly - though that seemed to be what we saw today - especially in the banks.

Late Update - by request our short-squeeze indicator shows two moments today that were good setups for notable potential squeezes - as the Goldman Short-Interest index hugely underperformed (which is good for shorts) and then greatly outperformed (squeezed) as the rallies came on...obviously not foolproof but nevertheless useful for some context.

Charts: Bloomberg

 

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Tue, 10/04/2011 - 16:49 | 1738893 GeneMarchbanks
GeneMarchbanks's picture

Let's not even talk about this... I'm just not ready, man. Someone tell me this much, has our collective Western culture gotten so dumbed down that this is now, not only acceptable, but the norm?

 

Next asshole to use the word "free" within six paragraphs of the word  'market" ... and I'll just... I'll I'll lose it.

Tue, 10/04/2011 - 16:50 | 1738921 12ToothAssassin
12ToothAssassin's picture

Obviously because 42 is the answer to the universe.

Tue, 10/04/2011 - 16:59 | 1738962 WonderDawg
WonderDawg's picture

We might have hit a near term low today, which will be followed by a month or two long rally. It goes against my every instinct to say that, which is why it's probably right.

Tue, 10/04/2011 - 17:03 | 1738977 Cdad
Cdad's picture

I highly doubt that.  I think you got half a day more...at the most.  And if the metals reverse and head up, which I think they will do tomorrow, it is game over for the S&P.

Zero hour is very, very close.

Tue, 10/04/2011 - 17:08 | 1738993 Ahmeexnal
Ahmeexnal's picture

Give me a few more days to buy some more "junk" silver.

How about a EU fast track approval for Turkey full membership?

That should give us at least a month. But it would obliterate Turkey in the process.

Tue, 10/04/2011 - 17:34 | 1739096 Cdad
Cdad's picture

The silver trade is ripe for a short squeeze.  I'm not sure you have a few more days in the paper market for silver, anyway.

As for Turkey...seriously, who cares?

Tue, 10/04/2011 - 20:45 | 1739701 Bicycle Repairman
Bicycle Repairman's picture

This is still a bear market, but you'd better understand THEY INTEND TO SQUEEZE EVERY SINGLE SHORT DRY on the way down.  They know exactly who the shorts are and what cards they are holding.  If you play, you lose.  You are public enemy #1.  They can f#ck you and everyone will applaud.

Tue, 10/04/2011 - 23:13 | 1740036 bid the soldier...
bid the soldiers shoot's picture

I think you mean that when it's not totally rigged and crooked, it has a downward bias.

I can live with that.

Wed, 10/05/2011 - 01:40 | 1740280 FreeNewEnergy
FreeNewEnergy's picture

Sorry, but silver is probably heading back to 17 per once all the ass-holes buying phyz at 20% over spot realize their massive mistake.

Not kidding and you can neg all you like, but check with me in 6 mo to a year and you'll kick yourself.

Tue, 10/04/2011 - 17:10 | 1739002 WonderDawg
WonderDawg's picture

As always, time will tell. I suspect a rally is forthcoming, I just thought we would get closer to 1020 S&P, and we still might, but I think a rally is close at hand. Short term rally, but it will be a chance to make some quick money, and then roll over into puts for the collapse, which will take out the 2009 lows on the way down.

Tue, 10/04/2011 - 19:07 | 1739442 Jack Napier
Jack Napier's picture

Patience my friend. 2 million put options on the S&P for shocktober means 1 of 2 things. Either TPTB are gearing up for some serious profits, or they are trying to fool everyone trying to ride their coat tails into getting sheared. Either way, there is about to be some movement and it never goes in a straight line.

Tue, 10/04/2011 - 20:23 | 1739640 WonderDawg
WonderDawg's picture

Yep, patience is the key. I did sell my CMG puts today for a tidy profit. Not a home run, I came in a little late, but not bad. Still holding my March LULU puts for now, we'll see what happens the next couple of days. If it looks like this is the rally I'm expecting, I'll sell the puts and buy some index calls. If my forecast is correct, I see potential for a fairly enthusiastic rally for a couple of months. But again, I'll see how the next day or two looks before committing any capital one way or the other. In this environment, practice patience and keep your powder dry for the big moves.

Tue, 10/04/2011 - 21:11 | 1739752 WonderDawg
WonderDawg's picture

Now that the dust has settled a little, I think it's possible this afternoon was just a bone-crushing short squeeze. I'm gonna sit tight, for now. Maybe we will drop down to 1010-1020. If we drop to 1020, that's the point I'll go long. If we bounce from here, well... I don't know. Fuck it. It's late and my brain is too fried for this shit.

Tue, 10/04/2011 - 17:26 | 1739055 boiltherich
boiltherich's picture

So long and thanks for all the fish.

Tue, 10/04/2011 - 22:48 | 1740000 jekyll island
jekyll island's picture

What do you get when you multiply 6 x 9?

Wed, 10/05/2011 - 00:27 | 1740172 Newsboy
Newsboy's picture

Is 42 your front chainring?

Tue, 10/04/2011 - 16:51 | 1738930 Motley Fool
Motley Fool's picture

Market has gone full retard. :|

Tue, 10/04/2011 - 18:36 | 1739341 UGrev
UGrev's picture

I don't think "Full Retard" fully describes the market. It's more like a multiple personality disorder coupled with manic depressive and seasonal affective disorder with a dash of schizophrenia for how it responds to the (rumor) voices in its head. 

Tue, 10/04/2011 - 20:30 | 1739662 bid the soldier...
bid the soldiers shoot's picture

No Tourette's?

Tue, 10/04/2011 - 21:14 | 1739755 UGrev
UGrev's picture

No.. that's what people think you have when they walk by your office as you stare at the market and hear your expressions of complete and absolute bewilderment. Something along the lines of "WHAT THE SHIT, MOTHER FUCK, CRACK ASS.. STUPID FUCKIN... AAAAAAAAHHHH!!"

Tue, 10/04/2011 - 23:16 | 1740044 bid the soldier...
bid the soldiers shoot's picture

I see.

It's only when you hear that on the subway that it's Tourette's

Tue, 10/04/2011 - 21:03 | 1739736 TheFourthStooge-ing
TheFourthStooge-ing's picture

I don't think "Full Retard" fully describes the market. It's more like a multiple personality disorder coupled with manic depressive and seasonal affective disorder with a dash of schizophrenia for how it responds to the (rumor) voices in its head.

Oh, now I understand. The market has been elected to congress.

 

Tue, 10/04/2011 - 16:52 | 1738933 chet
chet's picture

Yeah, why even try to apply rational analysis to this horseshit?  You want analysis:  It's horseshit.  There is your analysis.

Tue, 10/04/2011 - 17:25 | 1739049 boiltherich
boiltherich's picture

It was a rumor that Mayor Bloomberg ordered the police to arrest anybody south of 14th Street not wearing $2,000 shoes as OCCUPY WALL STREET protesters. 

Tue, 10/04/2011 - 17:27 | 1739061 Motley Fool
Motley Fool's picture

After reading this I'm inclined to cheer him on : http://occupywallst.org/forum/proposed-list-of-demands-for-occupy-wall-s...

:|

Tue, 10/04/2011 - 18:41 | 1739360 disabledvet
disabledvet's picture

You forgot "demand 42: happy days reruns will be returned immediately to their rightful place...just after MASH reruns..while Cheers reruns will assume THEIR rightful place BEFORE MASH reruns."

Tue, 10/04/2011 - 18:49 | 1739390 Troublehoff
Troublehoff's picture

Aye, too many socialists on there... it's so obvious what's going to happen if the 99%er people get their way. It won't be less government libertarianism. It will be socialism... :(

 

I tried to post this, but comments not uploading now:

Hi all,

First, thanks to all the protesters who are out there on the street even if the main stream media seems to be ignoring you.

I'm sure every one of these protesters has a different idea of what needs to change in modern western society which is why it's proving so difficult to speak with a single voice.

Personally, I'm not keen on the proposals listed above. They are socialistic and expect entitlements without responsibility. Also, what is fundamentally wrong with free trade?

I believe that what we need is lees government, more freedom, more transparency, and a money system where private institutions cannot create money out of thin air (i.e. abolish fractional reserve banking)..

I believe in welfare and health care but a person, if able should be expected to work in some capacity for these (even unemployed)..

do any of you think government can spend money more wisely than yourselves to deliver the services you yourselves require...?

when the government spends money badly, it is robbing you of your free time, or of a better standard of living, or of the possibility of an early retirement - there is no free lunch but with the original spirit that built the US and other western powerhouses, we could all enjoy a more prosperous, fairer society

Tue, 10/04/2011 - 17:03 | 1738979 BadKiTTy
BadKiTTy's picture

If you trade in this 'market' your money will be taken from you for free lol

Tue, 10/04/2011 - 17:37 | 1739115 reTARD
reTARD's picture

Irrational exuberance? As my "idol" Alan Greenspan would say.

Tue, 10/04/2011 - 17:43 | 1739138 iNull
iNull's picture

It's all about power. TPTB cannot afford to lose right now or they will lose everything. So they will pull every trick, every stunt possible, no matter whether it is obvious or not. They don't care at this point. It's life or death for them. A cornered and dying animal can fight with surprising strength and visciousness. Expect no less.

That said, moving the market for an hour is not "moving the markets." They just bought themselves another day is all. The entire system could crash at any time.

Tue, 10/04/2011 - 22:50 | 1739644 bid the soldier...
bid the soldiers shoot's picture

TPTB are not worried about losing. They are worried about what life will look like after they win. They would like it to be more normal than most predictions. Normal or not, they'll be on top.

I respectfully disagree with your observation: "moving the market for an hour is not "moving the markets."

Do you know what they got done in that hour? The derivatives? The leverage? How many thousand stocks follow the DJIA when it moves one way or the other? How short were they when they covered at the low of the day, How long when they sold at the top? How much in profits did they remove from our wallets?

They don't call them TPTB because they don't know what they are doing.

Tue, 10/04/2011 - 17:43 | 1739148 Grinder74
Grinder74's picture

free

(1)

(2)

(3)

(4)

(5)

(6)

(7)

market.

 

How's that?

Wed, 10/05/2011 - 00:05 | 1740132 mailll
mailll's picture

Allow me to make the correction.  MANIPULATED MARKET.  I hope this correction will set your mind at ease. 

Tue, 10/04/2011 - 16:45 | 1738902 mayhem_korner
mayhem_korner's picture

Fade reality.

Hookers and blow just showed up at CNBC's studios.

Tue, 10/04/2011 - 18:43 | 1739368 disabledvet
disabledvet's picture

This time through the front door! Woohoo!

Tue, 10/04/2011 - 16:46 | 1738904 Ellesmere
Ellesmere's picture

When are those f*ckers going to leave the market alone !

Reminds me of Sisyphus rolling his public money-ball up the taxpayer hill to see it collapse all over again. Stupid.

Tue, 10/04/2011 - 20:48 | 1739709 Bicycle Repairman
Bicycle Repairman's picture

"When are those f*ckers going to leave the market alone !"

When you leave.

Tue, 10/04/2011 - 16:47 | 1738906 Mongo
Mongo's picture

Collateralized Viagra...

Tue, 10/04/2011 - 17:15 | 1739022 ZeroPoint
ZeroPoint's picture

Look at this from 2008:  http://www.fool.com/investing/dividends-income/2008/10/07/holding-strong...

 

HAHAHAHAHAHAHAHAHAHAHAH!!!!!!

 

Tue, 10/04/2011 - 19:47 | 1739549 CrankItTo11
CrankItTo11's picture

That's fantastic. I wonder when they deleted all the comments that most likely were there at some point. 

Tue, 10/04/2011 - 17:43 | 1739147 adr
adr's picture

Well if the webpage stays down and my automatic payment doesn't get deducted and they use it as an excuse to hit me with a fee or raise my rate, I'll just stop paying them. Before I do that I might just take a few hundres out of a couple ATMs. Maybe I'll help the economy by buying a new car on the credit card. 

All bets are off with the bank of scum.

Tue, 10/04/2011 - 16:47 | 1738908 Josh Randall
Josh Randall's picture

Apocalypse paused while the world goes to the restroom...will resume shortly

Tue, 10/04/2011 - 17:13 | 1739012 tekhneek
tekhneek's picture

Yeah well... that's just like, your opinion... man...

Tue, 10/04/2011 - 18:51 | 1739397 disabledvet
disabledvet's picture

Is that the chant of "collapse! collapse! collapse!" I heard from "the protesters"?

Tue, 10/04/2011 - 16:49 | 1738920 The4thStooge
The4thStooge's picture

belgium has a government?

Tue, 10/04/2011 - 17:08 | 1738995 Piranhanoia
Piranhanoia's picture

Please, in the interest of humanity, stop using that word so carelessly. 

Tue, 10/04/2011 - 17:13 | 1739016 fuu
fuu's picture

He's angling for a Rory.

Tue, 10/04/2011 - 23:04 | 1740024 lano1106
lano1106's picture

Yes, it is the Dexia board.

 

Tue, 10/04/2011 - 16:50 | 1738923 MarketTruth
MarketTruth's picture

Bag of crap disguised as.......... Best....deal....ever.

Tue, 10/04/2011 - 16:50 | 1738926 Ruffcut
Ruffcut's picture

Glad, I'm out for at least a few days. Sold at peak vix on options. I've seen this shit before.

Fool me once, shame on you. Fool me again, I AIN'T GONNA BE FOOLED AGAIN, BITCHES.

Tue, 10/04/2011 - 17:14 | 1739018 tekhneek
tekhneek's picture

I thought you were going to go bushly on me for a second, but you pulled it out with a nice bitches at the end there.

Congrats on your VIX exit.

Tue, 10/04/2011 - 19:18 | 1739477 LetThemEatRand
LetThemEatRand's picture

Bush said "bitches" after every sentence he spoke.  But he said it silently to himself.  

Tue, 10/04/2011 - 16:50 | 1738927 pazmaker
pazmaker's picture

This is getting beyond any comprehension... total madness.

Tue, 10/04/2011 - 20:31 | 1739664 slewie the pi-rat
slewie the pi-rat's picture

nah. tyler called this weeks ago~~~the volatility and called:  "buy cheap straddles"!  which i, as an  old [but no longer] options guy figure = buy calls when the market is sold down, buy puts when rallies start getting pooped

pretty aresome, really;  fade the bullies;  these are nice swings for this,  and spreading & hedging is permitted 

Tue, 10/04/2011 - 16:52 | 1738932 Godisanhftbot
Godisanhftbot's picture

 You know what.

 This choreographed nonsense fails to impress me at this point.

 

 It's a giant  Wheel Of Fortune being spun by an old hag in a sequined dress.

Tue, 10/04/2011 - 17:29 | 1739067 NotApplicable
NotApplicable's picture

Madonna?

Tue, 10/04/2011 - 17:32 | 1739086 Spastica Rex
Spastica Rex's picture

Susan Sarandon.

Tue, 10/04/2011 - 17:44 | 1739150 Joeman34
Joeman34's picture

Hillary Clinton [now try to get that image out of your head]

Tue, 10/04/2011 - 18:04 | 1739243 NotApplicable
NotApplicable's picture

But they're purple sequins! That makes all of the difference.

http://30.media.tumblr.com/tumblr_led5794IJa1qag36no1_400.jpg

Tue, 10/04/2011 - 19:45 | 1739543 Axenolith
Axenolith's picture

Holy crap, does she have an appointment to conquor a make believe kingdom after that get together?!?!

Tue, 10/04/2011 - 21:48 | 1739826 slewie the pi-rat
slewie the pi-rat's picture

i'll just take tina turner on the Big Wheel

& purple sequinz, BiCheZ!

Tue, 10/04/2011 - 16:53 | 1738936 Dre4dwolf
Dre4dwolf's picture

and when the rescue plan fails as its designed to, the market will fall 800 points.

 

Nothing to see here, same old same old.... haven't we been down this road about 6 or 7 times already?

 

 

Tue, 10/04/2011 - 16:53 | 1738938 mynhair
mynhair's picture

Too violent by half was that 'rally'.  Hope the hedgies took advantage.

Tue, 10/04/2011 - 16:54 | 1738941 D.O.D.
D.O.D.'s picture

one more bounce, suck in the last of the bulls who haven't lost enough money... come to papa... Meat's back on the menu BOIZ!

Tue, 10/04/2011 - 17:00 | 1738968 mynhair
mynhair's picture

One more bounce works for me; still have some dead money to unload (GOV).

Tue, 10/04/2011 - 16:55 | 1738946 vast-dom
vast-dom's picture

SHEER FUCKING IDIOCY!

Tue, 10/04/2011 - 16:57 | 1738955 ptoemmes
ptoemmes's picture

And the CNBC WEBsite market recap headline is...Stocks Rebound Sharply on EU Bank Aid Plan

 

Plan, did they say PLAN!   There's no stinking plan (or badges - best I could find)....http://www.youtube.com/watch?v=CGcVhoHdRFo

Tue, 10/04/2011 - 17:42 | 1739140 NotApplicable
NotApplicable's picture

There's a plan, all right. Dueling press releases.

Tue, 10/04/2011 - 16:58 | 1738959 Belarus
Belarus's picture

BTW, I just have to ask this rhetorical question since no one else has: WHY DOESN'T GOLD EVER GET THE PARABOLIC MARKET ALGO-DRIVEN RAMP?

If this market rally was real, Gold would have soared. Let's see, Europe is going to recap their banks with money they don't have by taking on board toxic assets on balance sheets that are toxic themselves on the heels of European taxpayers that are in a depression.....

You get the point. It all makes sense. Right?

Tue, 10/04/2011 - 17:07 | 1738991 theotheri
theotheri's picture

Gold will not soar.   It is a barbaric relic that has no value beyond jewlery. Get used to its downward drop back to its industrial value.

Tue, 10/04/2011 - 17:14 | 1739020 Motley Fool
Motley Fool's picture

Please short it. Go all in. Please.

Tue, 10/04/2011 - 17:16 | 1739027 fuu
fuu's picture

Hahaha.

Tue, 10/04/2011 - 17:10 | 1739000 walküre
walküre's picture

Silver bounced quickly. Gold is lagging but could potentially go back to $1700 ish end of the week. How come it hit $1679 overnight last night?

Tue, 10/04/2011 - 17:35 | 1739101 tekhneek
tekhneek's picture

'tis tradition.

Tue, 10/04/2011 - 18:55 | 1739407 disabledvet
disabledvet's picture

Right up there with "how can gold be worth more than platinum" I imagine.

Tue, 10/04/2011 - 17:00 | 1738967 BadKiTTy
BadKiTTy's picture

Hahahahahahahahahahahahahaha!
F'ing ha!
Those who understand need no explanation
For those who don't....... No explanation can be given

We are all saved I tell you .......SAVED! /sarc

All I can to is laugh

K@

Tue, 10/04/2011 - 17:01 | 1738972 mynhair
mynhair's picture

Hope coughing up that hairball didn't hurt, sounded painful.

Tue, 10/04/2011 - 17:32 | 1739081 BadKiTTy
BadKiTTy's picture

Kool!! Thanks for making me laugh! :)

Tue, 10/04/2011 - 17:04 | 1738981 walküre
walküre's picture

What was the buying volume in the last 30 minutes?

Selling pressure remained higher. Markets were oversold, bounce was due.

World is not ending today, DEXIA is not Lehman. DEXIA didn't go tits up. Lehman could have been saved in 2008 (which many experts suggested at the time) and markets would not have tanked the way they did in 2008 and 2009.

Next few days will tell what is going on. MS up 12% because MS is not gonna go bust on the Greek derivative trade?

So many possibilities, so little time to discuss it all. Just remember who is controlling the "market" and that the "market" is absolutely no reflection of the real economy.

Tue, 10/04/2011 - 17:32 | 1739087 NotApplicable
NotApplicable's picture

Now, why would something be saved, when it was murdered for a reason? As for the next few days giving a tell, well, they will be every bit as fictional as the last few, so other than the next storyline emerging (with a few double/triple/quadruple head fakes), I wouldn't put much faith in them.

Tue, 10/04/2011 - 18:07 | 1739257 SilverDOG
SilverDOG's picture

DEXIA is a  MSM distraction. Away from BoA being Lehman. 

Synthetic Derivatives Bitchez!

Tue, 10/04/2011 - 18:59 | 1739418 disabledvet
disabledvet's picture

QE Europe. That would be for the entire Continent--except for those "little countries" of course. Hehehehehe. "Little Countries"...do they come any other way?

Tue, 10/04/2011 - 17:08 | 1738994 buzzsaw99
buzzsaw99's picture

the move seemed mechanized, coordinated, yes, almost not human at all.

Tue, 10/04/2011 - 17:10 | 1739001 Atlantis Consigliore
Atlantis Consigliore's picture

HFT hft hft hft, HFT,  ppt ppt ppt ppt, 

 

crack that whip...  LIMIT UP LIMIT DOWN round and round

sob sob sob sob,  mkts open and fair and orderly,  

 

rule 442, 332, 112,  plunge protect 45 min soar, 

 

ha ha ha hahh,  shish boom bah.

 

investors sell 70 B  hide out,    no fairth in the PONXI mkts....lol

Tue, 10/04/2011 - 17:11 | 1739005 CvlDobd
CvlDobd's picture

What about this STL bank of america thing? That has my interest. How valid is the youtube video and random articles?

Tue, 10/04/2011 - 17:12 | 1739007 heatbarrier
heatbarrier's picture

Hate to be a pinhead, Tyler, but I think it's plan #41.  

Tue, 10/04/2011 - 17:34 | 1739097 NotApplicable
NotApplicable's picture

Oh, you people and your zero-based indexes!

Tue, 10/04/2011 - 17:14 | 1739019 dcb
dcb's picture

like the post, but zh can be a bit schizophrenic. complain about the algo momo chasers not trading on data, then say the jump is from the euro rescue rumor. nonsense. it's because if you do the charts on a weekly we were due for a rally.

also please use the hourly macd indicator as to where the short squeeze is going to happen or end. rather good with the wilders rsi

Tue, 10/04/2011 - 17:14 | 1739021 Mr.Sono
Mr.Sono's picture

looks like everything will be ok. tiss tiss

I just got more silver bitches, let them roll in those paper stocks and money. let them have more and more paper. We all know there is plenty of trees.

Tue, 10/04/2011 - 17:27 | 1739023 Mohan
Mohan's picture

Tyler,

I consider myself a seasoned investor who always questioned the official lines (read spin). For more than 15 years, I participated on many blogs/bulletin boards. I learned a lot from them. But it is nothing like what I learned from ZH. I've been reading ZH for 2 years. I cannot express in words how much your site has helped me in trading better or gaining wisdom. I believe that Zh is a site that the establishment wishes that goes away.

I have one thing to say to you: Thank you for your selfless service!

Mohan

Tue, 10/04/2011 - 17:16 | 1739026 pacdm
pacdm's picture

Should the SEC look into this shit or is it just the new normal bullshit market , if this is the new normal then i hope the mother fu.....

do not get any bailout when the sky falls down

 

Tue, 10/04/2011 - 17:20 | 1739036 walküre
walküre's picture

The SEC is their firewall to protect the ponzi and the fraud. SEC will only interfere when they have a vested interest in pursuing something.

Tue, 10/04/2011 - 18:12 | 1739270 Grinder74
Grinder74's picture

Or when the midget looks really good in that leather outfit.

Tue, 10/04/2011 - 17:18 | 1739028 the grateful un...
the grateful unemployed's picture

this smells like a typical liquidity injection. everything goes up, including crude oil, (the all in one market is back). no point in parsing sectors, it was "all in" this PM, and in last half hour, which is when orders for tomorrows double and triple leveraged index ETFs have to be placed. now you and I know that having information like that ahead of time in no way implies that someone would share it, or steal it and therefore frontrun tomorrows moves, today??

and to make it all smell a bit worse, the FOMC cheat (chief) spoke earlier, and may have decided to light up the APPLAUSE sign. his gangster boss is in danger of losing the racket, and so there is great pressure to produce a bottom in this market, and get the whores and pimps working, so they can "tax" their efforts.

sigh, a cop costs a lot more now than it did in Al Capones day, about 4.6 million to be exact. all this inspires confidence, doesn't it. by the way there's a great new article over at Agora Finanicial on the cost of the SECRET government, a brief sketch of how it has grown, and a few stock picks for those who want to get rich on the new security state, for subscribers of course. I would provide a link, but the Feds watch those things.

Tue, 10/04/2011 - 17:18 | 1739031 Lord Welligton
Lord Welligton's picture

Trichet raises the worst of all prospects and ZH has not one headline?

http://news.yahoo.com/trichet-sees-markets-worst-crisis-since-wwii-08412...

Tue, 10/04/2011 - 17:22 | 1739041 Motley Fool
Motley Fool's picture

9th August? I suspect this has been covered a bit earlier than today.

Tue, 10/04/2011 - 17:37 | 1739116 NotApplicable
NotApplicable's picture

Next up, Waterloo highlights. ;-)

Tue, 10/04/2011 - 19:12 | 1739459 andybev01
andybev01's picture

I've been hearing a lot about the tulip market.

what's up with that?

Tue, 10/04/2011 - 17:23 | 1739046 Big Ben
Big Ben's picture

180B euros is a lot of money for just one bank. GDP of France+Belgium is less than 20% of US GDP. So scaling this up by 5 times 1.32 $/euro, means this would be equivalent to a $1.2T bailout if done by the US. For just one bank. And France has its own problem banks.

This looks like a desperate move by France to try to forestall a run on its own banks. And even if France is willing and able to bail out its own banks, who is going to bail out southern Europe?

Germany is the key. The pressure on Germany to "step up and do the wrong thing" will increase greatly. Will they cave?

Tue, 10/04/2011 - 22:05 | 1739872 chindit13
chindit13's picture

Since you put it that way.....

I think it would be for the best to DK every trade after 15:15 EST.

Turn those machines back on!

Tue, 10/04/2011 - 17:26 | 1739053 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Everytime the Senate asked Bernanke if he could do anything to help the economy, he smiled a 'What me worry?' grin.  Wouldn't you be a little worried if your Neo-Keynesian policy was turning up lame?  Either he is one of the dumbest men on the planet, or he is up to something.  I guess we will find out if he loaned Europe $100 trillion from his magic digital printing press soon.  Pay up taxpayers, the Bernanke is a comin'.

Tue, 10/04/2011 - 17:29 | 1739066 the grateful un...
the grateful unemployed's picture

he's already parked the cash in their MM funds. you know how this works, I don't pay your mortgage, but I buy your food so you have enough money to pay your mortgage. this is how M2 keeps rising, the BOJ did this in Japan in the lost decade, BB is a student of those times. that US taxpayer dollars propping up Euroland, and you have nothing to say about it.

Tue, 10/04/2011 - 17:30 | 1739059 bid the soldier...
bid the soldiers shoot's picture

___DISCLAIMER___

It is assumed that all persons
trading the equity and commodity
markets, are aware of the INTEGRITY
of those markets and trade at their
own harm, injury and risk.

Tue, 10/04/2011 - 17:27 | 1739062 Ned Zeppelin
Ned Zeppelin's picture

My post at 9:11 am:

"The hot rumor to turn this thing around and kill all the shorts is coming, count on it people.

Be careful out there. There are bulls and bears, but most of all there are wolves who hunt either as prey."

Tue, 10/04/2011 - 17:36 | 1739108 SixFeetFromTheHedge
SixFeetFromTheHedge's picture

To me this seemed like a last desperate but coordinated attempt by all the big banks to squeeze the shorts and do some technical dammage.

I don't believe the FT rumor alone gives full merit to the exagerated rally.

If you look at this move from the bank's perspective it's a genius yet desperate move.

 

Tue, 10/04/2011 - 17:36 | 1739109 boiltherich
boiltherich's picture

Look, I know algos are fast, I know there is limitless money in the PPT accounts, and I know that when someone bids 4% or more over ask they usually get what they try to buy really quickly, but on an index with a market cap of over twenty trillion how do you even physically possibly move it by more than a trillion in less than 45 minutes?  I would be tempted to dismiss it as panic buying because of a particularly strong rumor on the floor but still the question remains, more than a trillion dollars of buying in three quarters of an hour with virtually no sell volume?  This really does not make any sense from any angle.  It is almost time to haul out the fat finger again, but first things first, sell now ask questions later because any market this crooked is a time bomb about to blow. 

Tue, 10/04/2011 - 17:39 | 1739131 NotApplicable
NotApplicable's picture

"Give me a lever long enough and a fulcrum on which to place it, and I shall move the world."

Tue, 10/04/2011 - 17:47 | 1739142 heatbarrier
heatbarrier's picture

Gratest mathematician of all times.   Big fan.

 

Tue, 10/04/2011 - 19:17 | 1739471 Money 4 Nothing
Money 4 Nothing's picture

What's that? give me leverage high enough and I can snooker any world market?

Tue, 10/04/2011 - 19:31 | 1739510 taraxias
taraxias's picture

post of the day

Tue, 10/04/2011 - 21:09 | 1739748 IMA5U
IMA5U's picture

The market was acting funky all day.  GM and many of the metals/energy names rallied after the open.  MS opened down 7% to trading flat faster than Becky Quick jumps in the sack with The Old Country Buffett.  Something was up.  We were also at "death cross" levels and when AAPL was down 5%, it seemed like game over.

 

So lo and behold chatter of "EU" and "recapitalization" picks up steam after an FT plant. 

Today reminded me of a lighter version of the fast rally in August after Bernake said rates would remain low for the next 3 years.  Market opens lower.  Bearded one on TV.  Sectors of market act weird.  Market looks like it will finally roll over.  Then the bogus chatter/news/rumors.  Upcrash.  

It probably has legs.  Septermber was brutal and guys want to chase perfromance in the Q4.

 

 

 

Tue, 10/04/2011 - 22:05 | 1739861 chindit13
chindit13's picture

Sellers have been hitting bids, not placing a whole lot of real offers.  Thus, there would not be much above the market except air and HFT ether.  Neither present much resistance.  A small amount of money can add a whole lot of "value".  Of course, when the market moves in one's favor, mark-to-market is gospel truth.

Tue, 10/04/2011 - 17:38 | 1739121 css1971
css1971's picture

10 more days.

Tue, 10/04/2011 - 18:06 | 1739251 jomama
jomama's picture

paint me naïve.  what happens in 10 days?

Tue, 10/04/2011 - 18:08 | 1739260 maxmad
maxmad's picture

till what?

Tue, 10/04/2011 - 17:43 | 1739143 BadKiTTy
BadKiTTy's picture

It occurs to me that those behind the Market lift off ought to sell their services to NASA. If they can get that piece of shit to go that high that fast, then they should be able to put an aircraft carrier into orbit.

They would probably get a green energy grant too given that the launch vehicle runs on bullshit and not rocket fuel......

K@

Tue, 10/04/2011 - 18:09 | 1739264 NotApplicable
NotApplicable's picture

No real market participants = lack of gravity

Tue, 10/04/2011 - 17:44 | 1739152 trampstamp
trampstamp's picture

There is nasty divergance on the 30 treasury weekly charts. Doesn't look good for long bonds. Thoughts?

Tue, 10/04/2011 - 17:48 | 1739165 PulauHantu29
PulauHantu29's picture

STFP

Sell the Fu*k*n Pop!

Tue, 10/04/2011 - 17:55 | 1739203 John McCloy
John McCloy's picture

All I know is this..

FAZ essentially to a tee follows the S&P regardless of all the decay talk to a near tee and all of these moves do nothing but prevent shorts form entering only decreasing the amount of people left to cover in a decline which can actually buoy the markets...The numbers are the numbers and all the talk in the world will not prevent the EUR reaching parity and eventual collapse as nations depart to recreate their own currency. 

        I am short for 3 years now and proud and sleep very well at night knowing that our entire system is predicated upon lies just to pretend it is solvent. It is over...it has been over..and if it takes another 2 years to prove it is over I will be wealthy beyond my wildest dreams. Just think of the 88 years of 0% rates, fiction accounting, media lies and pumping, short squeezes, banning of shorts, margin hikes, and literally 738 rumors needed and 3 QE programs just to get us to THIS point. Once again as they were n 2008 they will be late to the party dependent upon Uncle Sugar and be left wondering "what happened?"..

  Get Short...Get Shorter...Stay Short..margin yourself to the hilt short and come back in 5 years. There is no money nor political will left to print..it is over.Just short it all..walk away and come back with your 5000% gain in 5 years and buy up the remnants of this disaster of a global economy.

Tue, 10/04/2011 - 17:56 | 1739208 jomama
jomama's picture

makes perfect sense to me.  what's the problem?

Tue, 10/04/2011 - 18:07 | 1739258 chump666
chump666's picture

Don't stress it, three days of selling there had to be one day for a melt-up rally. I actually had this pencilled in for Wends/Thursday...there you go, happened early.  It's a meltup via a bulltrap via a dead cat bounce via "you buy into this, you'll lose money".

Point is, Asia is slowing down rapidly, US markets aren't factoring this in, to transfixed on Europe which is all but a write off.  Watch Asian markets next few hrs, they can't muster a rally and fall back into the neg.  The bear will knock this f*cking bull to the ground.

Tue, 10/04/2011 - 19:07 | 1739445 Money 4 Nothing
Money 4 Nothing's picture

Excellent deduction, Looks like this fresh $$ floated today will be traded out overnight? or gone bye the morning?

 

Tue, 10/04/2011 - 19:27 | 1739500 chump666
chump666's picture

I think so, if the CME assumes volatility will cease on financials, and they cut margins, but we still get volatility on commodities.  That's a short sell sign.  The melt-ups will cease, just melt-downs

But, markets were oversold and we still need to trade lower.  When you see a melt-up like last session you know it's a bulltrap.  

As for Bernanke, he is clueless, not only of how markets work but when commodities start to sell (prior to Greece) there is a crisis brewing and it has nothing to do with Europe Zone which is a zombie anyway.  So QE/Op twist or what ever else he can pull...won't do anything.

Tue, 10/04/2011 - 19:14 | 1739464 Fix It Again Timmy
Fix It Again Timmy's picture

Rescue Plans r Us - shop 'til you drop, and today's special is....

Tue, 10/04/2011 - 19:46 | 1739548 Rockfish
Rockfish's picture

 

 

 

Kudlowbowski predicts QE 3 and alot of other crap.

Tue, 10/04/2011 - 19:54 | 1739577 ivars
ivars's picture

I made long term EUR/USD prediction (2011-2017) to see if there is some support t her for ideas to understand better the default/devaluation ( Europe) debt deflation/default  ( USA) sequence I have been looking at lately.

Here it is with explanations:

http://saposjoint.net/Forum/viewtopic.php?f=14&t=2626&p=34394#p34394

Here just chart:

http://www.tfmetalsreport.com/comment/66127#comment-66127

It does support debt  deflation in the Usa during 2012-2014 recession. QE3 won't change anything, perhaps delay deflation till June 2012.

 

Tue, 10/04/2011 - 20:27 | 1739655 msmith
msmith's picture

USD Index and the AUDUSD have begun their retracements as expected. http://bit.ly/oenUSf

Tue, 10/04/2011 - 20:41 | 1739688 Kina
Kina's picture

News for the Australian markets.

Around the next corner is an angry Chinese man with a big foot about to give you one giant kick in the nuts.

 

This is a good as it gets...so get out.

 

 

Tue, 10/04/2011 - 21:02 | 1739732 IMA5U
IMA5U's picture

This is a very good and informative write up.  It's great that credit market color is included.

 

Keep up the good work Tyler!  

 

 

Tue, 10/04/2011 - 21:15 | 1739758 Zgangsta
Zgangsta's picture

Japan was obviously not fooled by this sucker's rally...

Tue, 10/04/2011 - 21:23 | 1739778 azzhatter
azzhatter's picture

I thought maybe Cramer farted and lifted the market

Tue, 10/04/2011 - 23:35 | 1740076 cranky-old-geezer
cranky-old-geezer's picture

 

 

I don't know how a retail trader can trade these markets with any success when they can move 3% on freikin rumors. 

Seems bank news (and rumors) is all that matters anymore.

We spend 90% of our time here talking about banks it seems.

Tue, 10/04/2011 - 23:37 | 1740088 Michelle
Michelle's picture

Everyone expecting the BIG BANG isn't going to get one. There will be no Greece default in the formal sense as they are currently in the midst of working through the default now. CDS won't be triggered and will expire without the big payoff. Allowing bondholders and their cheerleaders creating economic and financial mayhem across the globe is no longer going to be tolerated. Bernanke and Co. won't be dropping money out of helicopters willy-nilly every time the markets tremble as the markets will soon learn that they no longer control the world, for if sovereigns bowed before the so-called masters of the universe, we surely will have one rolling crisis after another and that's not a realistic long-term solution. 

There are some that want to see the end-game played out in some chaotic, barbaric fashion, but I have a hunch that none will see it play out that way. Do we go out with a bang or as a whimper? Maybe neither.

 

Wed, 10/05/2011 - 01:26 | 1740268 Peter K
Peter K's picture

It's the words that are important, I tell ya.

Reality , i.e. Italy downgrade 3 notchs is nowhere near as important when compared to the anouncement of a "dubious" plan to have a plan when a plan is needed to be had in cases like the one now where a plan is needed.

Who cares about the funding side? The algos definately don't.

Hey, I have an idea...........:)

 

Wed, 10/05/2011 - 03:14 | 1740357 sulfur
sulfur's picture

its not a market its a motion picture

Wed, 10/05/2011 - 04:45 | 1740410 theprofromdover
theprofromdover's picture

Of course it will go up; the trading system lost track of the fundamentals decades ago.

Until such times as they make you hold any purchases for a week, a month, whatever, the market is just for playing games.

How can any company's stock go 50% either way in 12 months, except by mischief.

How useless an activity betting that you can be a millisecond ahead of your trading compeitors, and therby make some money.

What a waste of talent.

System broke -don't fix it, scrap it.

 

Wed, 10/05/2011 - 07:01 | 1740486 hyperbole2000
hyperbole2000's picture

I see the final impulse wave up to end a wave 2, from an Elliot wave perspective, leading to a very large and intense wave 3 down. The impulse wave about to unfold will be the 5 wave leg C of a flat. This will complete the zig-zag flat combo that constitutes the wave 2.

Wed, 10/12/2011 - 12:08 | 1766064 karmete
karmete's picture

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