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The "New Normal" FX Rip

Tyler Durden's picture


This is how a completely news-less FX move looks like under the new normal, at precisely the moment when market opens. Did we say no news? Yes. 80 pips move in minutes on absolutely nothing, but an avalanche of very specific stop limit triggers. And since the EURUSD is the highest levered fulcrum security, and since shorts have piled in aggressively in the last few days, ramping the pair to the stratosphere is why risk is soaring, once again on no positive news. And now that the market move has happened, the news to explain it will come fast and furious. One wonders if all of the now unwound CIO capital has moved into JPM's most recent prop trading addition: the CFXO.


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Fri, 07/13/2012 - 09:52 | 2612630 ZippyBananaPants
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Jamie, Jamie, Jamie,  why dont all these talking heads just blow him and lick his nut sack.  jeeezzze!!!

Fri, 07/13/2012 - 09:58 | 2612663 Village Smithy
Village Smithy's picture

Slavish devotion, makes a real man want to puke doesn't it?

Fri, 07/13/2012 - 12:13 | 2613198 The Monkey
The Monkey's picture

We are fast closing in on short selling time. Can the S&P pierce 1376? I think it can. When it punces through 1360, we will bring more buyers in as the downward sloping channel will be pierced. Apple is up on the 24th, so I think even more buyers will be piling in on the momentum frenzy.

Look to begin dollar cost averaging at 1390.

Fri, 07/13/2012 - 10:11 | 2612725 Unprepared
Unprepared's picture

Not everybody is so fortunate (talking about said talking heads).

Fri, 07/13/2012 - 09:53 | 2612631 JackT
JackT's picture

Whoot There It Is!

Fri, 07/13/2012 - 10:06 | 2612688 Nothing To See Here
Nothing To See Here's picture

Is that today's gold chart above?

Fri, 07/13/2012 - 10:14 | 2612738 Hmm...
Hmm...'s picture

There is a simple and legal explanation for all this movement prior to the news being broken.

HFT has become so fast that the trades can literally go back in time!  Just like Michael J Fox's DeLorean.

The traders wait until important information happens, decide on a trade, hit "send" and the electrons go back in time to now!

The only problem with this, of course, is that it is one further step towards SkyNet.  So hopefully Arnold Schwarzenegger doesn't also come back in time too!

Fri, 07/13/2012 - 19:06 | 2614786 Anonymouse
Anonymouse's picture

Nothing new there. Hillary did it 20 years ago with cattle futures

Fri, 07/13/2012 - 09:53 | 2612633 alien-IQ
alien-IQ's picture

a couple of days ago I commented that I'd be looking for a EUR/USD bounce off the 1.2150(ish) area...but god damn. what the fuck was that?

Fri, 07/13/2012 - 09:54 | 2612646 JackT
JackT's picture

a giant EURUSD penis

Fri, 07/13/2012 - 09:54 | 2612647 sdmjake
sdmjake's picture

My .02: That is a SkyNet controlled market....

Fri, 07/13/2012 - 10:23 | 2612789 DeadFred
DeadFred's picture

If you go to a daily EURUSD chart and draw a straight line from the January low to the June low and extend it you'll see that the euro has hit that trendline support two time in the last couple days and bounced off. Short timers would have been fools not to book their profits on the second bounce. I don't think this trendline has the strength to hold (my opinion isn't worth a lot) and it's dropping about 10 pips per day but why not sell and rebuy at a somewhat sweeter price in a few days, it's Friday after all. After this support breaks (it will) I only see one more support, then just air. This is a terrible time to be long euros.

Fri, 07/13/2012 - 10:33 | 2612825 giovanni_f
giovanni_f's picture

efficient market theory tells us that a price discovery just has taken place. Ask ben solyndra bernanke

Fri, 07/13/2012 - 09:53 | 2612636 localpacific
localpacific's picture

volatile markets all around ..   Volatile Markets Continue On Friday the 13th

Fri, 07/13/2012 - 09:53 | 2612637 IBelieveInMagic
IBelieveInMagic's picture

I love this "market"! Every moment has exciting possibilities.

Fri, 07/13/2012 - 09:53 | 2612638 The Gooch
The Gooch's picture

All of your black Fridays are belong to us.

Fri, 07/13/2012 - 10:06 | 2612691 Ness.
Ness.'s picture

Black Friday - Steely Dan.


When Black Friday comes
I'll stand down by the door
And catch the grey men when they
Dive from the fourteenth floor
When Black Friday comes
I'll collect everything I'm owed
And before my friends find out
I'll be on the road

Fri, 07/13/2012 - 09:54 | 2612642 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

Since ZH has pretty much outed Mssrs. Sack and Potter, why even hide it anymore on their side?They probably hone their ideas on what and how to do it from ZH.

As Leonard Cohen says, "Everybody knows."

Everything at bottom of channel, everything bounces, just a little help from our "friends".

After all, it's Friday and real earnings reporting starts next week with heavy volume. And it will be hard to put lipstick on that pig, but everyone knows that is the oldest of Wall Street and thus Liberty Street tricks.

Fri, 07/13/2012 - 09:53 | 2612644 SmoothCoolSmoke
SmoothCoolSmoke's picture

Free markets.  Biggest joke going.

Fri, 07/13/2012 - 09:55 | 2612650 francis_sawyer
francis_sawyer's picture

Waddell & Reed just playing some Friday the 13th hijinx...

Fri, 07/13/2012 - 09:55 | 2612652 cbaba
cbaba's picture

Hi Tyler ,

there is a correlation between Euro/Dollar rate versus Gold price.

they are trying to keep the euro rate artificially so that Europeans don't buy into gold. So if there is a sudden buy in gold then BIS will buy Euro even though there is no news.

This is what happened right now.

Just watching Gold price is enough to understand where the Euro will go..and of course there are limits but they control most of the time..

Fri, 07/13/2012 - 09:56 | 2612657 swissaustrian
swissaustrian's picture

Rumors are so 2011

Fri, 07/13/2012 - 09:56 | 2612658 doc_in_the_house
doc_in_the_house's picture

took all my EUR short profits yesterday @ 1.219

was holding from 1.27-1.26...major GAIN$$$$ in just 2 weeks = 450+ pips times 3X leverage through forex (big boy territory) not stupid ETF = FEE$$$ for idiots...

now its @ 1.223.....waiting for 1.23-1.24 to re-short and hold til 1.10 baby !!!

also pump up the spx to 1360 today stupid shoe shine boys....don't stop @ 1346, i need to start BUILDING SHORT positions @ 1360...ok i can wait for next week....

off to the beach !!

Fri, 07/13/2012 - 10:00 | 2612670 alien-IQ
alien-IQ's picture

I was looking for 1.2150 range to go long the E/U again...but I missed this pop and no way in hell I'm piling in after a move like that.

Oh well...looks like an early beach day for me as well.

Fri, 07/13/2012 - 12:50 | 2613329 Bizaro World
Bizaro World's picture

I also was able to take advantage of recent drop in Euro (gains in EUO), though apparently I'm an idiot for making money on an inverse ETF....add that to being uncivilized for diversifying with Gold and Silver....


Fri, 07/13/2012 - 09:58 | 2612661 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

FX can be bid up in the blink of an eye, harder to keep it up there, yet why give up ground? Right from the start, break the will of the shorts in all markets, send them to the beach where they can relax after having covered.

The SPX / EUR is slipping off, so give it a couple of minutes and a new surge will come into play. Up 1.25%, 1.5% why not, no news is good news.

Happy weekend!

Fri, 07/13/2012 - 10:05 | 2612680 Village Smithy
Village Smithy's picture

It's a backdoor short ban and Benny and the Banksters love it. I'm seriously beginning to think that "risk assets" have become a sink hole for all the trillions that have been printed. They may just continue to grow inspite of economic problems.

Fri, 07/13/2012 - 10:23 | 2612786 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

Apparently that is the plan. The shell game. While the world deleverages from its drunken debt induced binge, asset markets are inflated by central bank printing and direct invervention, the man on the street reads the paper and sees that it is up, the idiots as well as the cynics just BTFD.

At some point, all the fools will come rushing in and the Liberty boys will be able to step aside from direct intervention. Evidently, that time has not yet come.

Fri, 07/13/2012 - 13:56 | 2613607 Dollar Bill Hiccup
Dollar Bill Hiccup's picture

For the record, about 2pm and Bingo! the SPX is up 1.5% ...

I marvel even as I remain disgusted ...

Fri, 07/13/2012 - 10:12 | 2612665 midgetrannyporn
midgetrannyporn's picture

skynet detected a human interloper and destroyed it.

Fri, 07/13/2012 - 10:00 | 2612669 RobotTrader
RobotTrader's picture

KRE only $2 away from making 4-year highs.  U.S. banking stocks have been ultra strong lately.

Fri, 07/13/2012 - 10:07 | 2612699 somethingisrotten
somethingisrotten's picture


Fri, 07/13/2012 - 10:01 | 2612672 Cognitive Dissonance
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"This is how a completely news-less FX move looks like under the new normal......"

Looks like morning wood to me. Mrs. Cog says it's a sign of health. :>)

Fri, 07/13/2012 - 10:03 | 2612675 Quinvarius
Quinvarius's picture

Or, the inevitable has been scheduled by the Fed.  There is no way around it.  We all know it is coming.  They will not let the rate of fiat debt money growth slip under 0%. 

Fri, 07/13/2012 - 10:09 | 2612712 Nothing To See Here
Nothing To See Here's picture

I was thinking the same after watching gold's move. Some seem to think that the Fed is cockblocked into doing something.

Any news on Italy?

Fri, 07/13/2012 - 10:13 | 2612735 Nothing To See Here
Nothing To See Here's picture

I was thinking the same after watching gold's move. Some seem to think that the Fed is cockblocked into doing something.

Any news on Italy?

Fri, 07/13/2012 - 10:03 | 2612676 Screwball
Screwball's picture

How much money would it take to make a move like this?

Fri, 07/13/2012 - 10:04 | 2612679 alien-IQ
alien-IQ's picture

Truck loads.

It sure as fuck wasn't a "retail" move.

Fri, 07/13/2012 - 10:09 | 2612714 LongSoupLine
LongSoupLine's picture

Nothing is a "retail move" anymore.

Zero event gets closer every day.

Fri, 07/13/2012 - 10:05 | 2612682 CcalSD
CcalSD's picture

Don't knock it until you Rip it!  Gotta love leverage!

Fri, 07/13/2012 - 10:05 | 2612684 youngman
youngman's picture

That used to be the precious metals market.....

Fri, 07/13/2012 - 10:05 | 2612687 RobotTrader
RobotTrader's picture

JPM up 4%, the lows are in.

Fri, 07/13/2012 - 10:10 | 2612720 1eyedman
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the high is for our second feature today, 'sideways'

Fri, 07/13/2012 - 12:59 | 2613376 ZeroAvatar
ZeroAvatar's picture

"Off the lows!"   BRAAAWWKK!  (Whistle)

Sat, 07/14/2012 - 15:11 | 2616196 MeelionDollerBogus
MeelionDollerBogus's picture

Nope. Dimon's getting hassled about the CIO and low shareholder value and wanting / expecting split offs of JPM so one part of it is ONLY investing and not retail banking.

That's not a good sign for JPM. Doesn't matter what Dimon/others say they want/will do what matters is the shareholders want change and will leave if they don't get it.

Fri, 07/13/2012 - 10:07 | 2612696 somethingisrotten
somethingisrotten's picture


Fri, 07/13/2012 - 10:08 | 2612704 rsnoble
rsnoble's picture

Oh look, the Fed's have their big green fuck stick out this am.

Fri, 07/13/2012 - 10:08 | 2612705 OldE_Ant
OldE_Ant's picture

lol.  Someone has a bulging big stick up the pants of bears today but alas the bear still has teeth, and a lot of sticks up the pants so nothing new here.   Same old rinse and repeat.   Might as well just close the markets now and call it a UP day because Ben found a whole new pile of $1's to put 00's on and has his minions working overtime in the ctrlP factory.

Fri, 07/13/2012 - 10:08 | 2612708 Roland99
Roland99's picture

US Consumer Sentiment comes in at 72 (under expectations of 73 and lowest since Dec.)


Perhaps that bit of bad news brings on more hopium for QE3.


Fri, 07/13/2012 - 10:08 | 2612710 RobotTrader
RobotTrader's picture

Somebody just bought 5 million shares of XLF.  Bears better watch their backs.

Fri, 07/13/2012 - 10:10 | 2612722 somethingisrotten
somethingisrotten's picture


Fri, 07/13/2012 - 10:16 | 2612748 Bay of Pigs
Bay of Pigs's picture

Your insight into these markets is astonishing

Fri, 07/13/2012 - 10:09 | 2612716 Village Smithy
Village Smithy's picture

If this reallocation from Treasuries to risk assets picks up steam it could end up being the most disasterous unintended consequence in Central Banking (Planning) history. 

Fri, 07/13/2012 - 10:10 | 2612719 Amish Hacker
Amish Hacker's picture

Wow. Now THAT's a fat finger.

Fri, 07/13/2012 - 10:10 | 2612723 PaperBear
PaperBear's picture

Gold and silver spike again. Friday the 13th for JPM.

Fri, 07/13/2012 - 10:12 | 2612726 Peter K
Peter K's picture

Russian Central Bank rumored. Also large barrier on NY cut.

Fri, 07/13/2012 - 10:15 | 2612742 Benjamin Glutton
Benjamin Glutton's picture

Moments after Warren Buffet proclaimed he is not short the Euro on Bloomberg.

Fri, 07/13/2012 - 10:15 | 2612745 doc_in_the_house
doc_in_the_house's picture

to 0-hedge:  gold spiked up BEFORE EUR did..

i remember watching EUR @ 1.218 few hour ago, when gold was up like $15...sorry if you missed the signal !! the gold market is smarter than the forex market..which is smarter than the casino stock market. 

i covered all my EUR shorts of 1.265 avg price yesterday @ 1.219....i don't care if they dropped to 1.216 today....i made beacoup $$.....also covered my spx 1365 futures shorts yesterday @ 1326-1328....posted this in real time...u can check......

now waiting for some major pumps before reshorting both !

Fri, 07/13/2012 - 10:29 | 2612781 Bay of Pigs
Bay of Pigs's picture

+1 well played.

GOLD is going to go beserk soon. Much like MF Global and PFG have shown us, the "allocated" gold is not there. The panic will send shockwaves around the world and cause a massive run.

It is going to be EPIC.

Fri, 07/13/2012 - 10:47 | 2612882 OldE_Ant
OldE_Ant's picture

Beserk - yeah sure - With the vice like grip TBTF has on things nothing will go Be-serk until they want it to.  And that will be just after the re-allocation of resources happens.  lol.  Peak oil, peak gold, peak productivity, hmm.  peak humans coming soon?!  And then some lifetimes later peak totalitarianism?!   Run Logan, RUN!

End of Line

Fri, 07/13/2012 - 11:09 | 2612957 Bay of Pigs
Bay of Pigs's picture

Oh really? did you miss what happened last year? Silver 26 to 49 and gold 1320 to 1900.

Supply demand and suppression of price discovery says you're wrong. THEY are long when they need to be.

Fri, 07/13/2012 - 12:44 | 2613296 OldE_Ant
OldE_Ant's picture

Don't forget oil to $110-120.  This year oil 110 back to 80, Gold back to $1500-1600, Silver you guessed it back to $27.   Don't get me wrong I keep stacking and converting FRNs into things that 'matter', but don't think there will be this MAD rush to anything other than guns, food and water.  And guess what - when that happens a lot of govts will be yelling martial law, and re-allocating 'needed' resources at the point of a drone flying overhead, or a tank in your front street.

Oh and BTW:   Did you pay attention to what the USD did in the same time frame.   So please lets try to avoid an argument regarding 'price discovery' in markets because the prices arn't discovered they are 'set' (LIBOR on the rocks anyone?!).   Everyone is trying to position for the upcoming nasty 'end game' and me thinks 99% will be suprised when that occurs.  BTW: I'm not saying I'm one of those 1% who will be right.  I'm talking out my gaster here like the rest.  But don't think you, or I know anything about what is afoot, because I suspect what actually will happen is going to suprise a lot of people (and not because our friends the anal-probing aliens will come back and shower the world in gold before they 'service us', or is that 'serve us').

What isn't just wrong, but ill conceived is the idea that FRNs could ever represent anything related to What Matters (Energy, and Matter).   Since putting a zero on the end of a number in a computer takes barely a few electrons now-a-days.  And if that number represents the number of oz of Gold somewhere those few electrons just did a hell of a lot of magical work making 9x more of something.    And that extra zero is what we got in the past 5 years.   Does anyone think we magically 9x'd everything over those 5 years?   Hence does anyone think that 'market prices' in FRNs mean dink, when it comes to you or I getting food or water tomorrow, next year, do we magically have 9x more energy, or medical care, or anything?? 

I guess (and this isn't applying to you Pigs, or anyone directly) one could say we may have 10x more unemployed, 10x more idiots, 10x more anger and frustration, but then I'd be a real stool valve.

Smiles.  Back to converting my FRNs into something really useful since I need more electrons to throw bits around.

Fri, 07/13/2012 - 12:51 | 2613342 Bay of Pigs
Bay of Pigs's picture

Fair enough, if you're going to go Armegeddon on me, I wont argue the point. :o)

Place your bets and hope for the best. Good luck...

Fri, 07/13/2012 - 13:04 | 2613399 ZeroAvatar
ZeroAvatar's picture

doc, you're just gambling.  Go long, get Corzined.  Go short, get Madoff'd.  The only winner is the House (banksters).  You can't beat the computers. 


My advice:  Purchase silver bullion in coin form, store in boat,  go to beach, (whoops!) danged wave tipped the kayak over!

Sat, 07/14/2012 - 15:58 | 2616270 MeelionDollerBogus
MeelionDollerBogus's picture

If you're good at math you can always beat the computers.

Fri, 07/13/2012 - 10:17 | 2612755 niktamere
niktamere's picture

It's so cool how we all buy on lows and sell on highs.. etc..

Fri, 07/13/2012 - 10:19 | 2612758 Village Smithy
Village Smithy's picture

I think that the TBTF stood around this morning waiting for a reaction to  Jamie's CDS bomb and when they realized no one gave a shit ( besides the people here at ZH who obviously hold our society's moral compass) they facebooked the word "Party on Wall Street!"

Fri, 07/13/2012 - 10:18 | 2612761 Silversem
Silversem's picture

Great move for using the cfd instrument to take advantage of it with leverage! And make some money of this corrupt market!

Fri, 07/13/2012 - 10:45 | 2612873 Godisanhftbot
Godisanhftbot's picture

 It's a game. Belmont is not open till 3PM today, so the gamblers need an outlet.

Fri, 07/13/2012 - 11:15 | 2612977 NEOSERF
NEOSERF's picture

Bonuses depend wholly on how much muppet stuffing you can do...only markets to play in are equity and junk which are synonymous now..

Fri, 07/13/2012 - 11:22 | 2613004 gookempucky
gookempucky's picture

I am suing for whiplash

Sat, 07/14/2012 - 14:23 | 2616090 Grand Supercycle
Grand Supercycle's picture

Equity rally can resume as overbought USDX daily & weekly chart commences overdue retracement while EURUSD selling ceases for now. This results in SPX / DOW choppy weekly charts reverting to neutral.

This remains a constant and will not change:

* USDX monthly indicators [ie big picture] continue to warn of significant long term USD upside. (thus EURUSD & AUDUSD etc bearish)
* SPX monthly indicators [ie big picture] continue to warn of significant long term downside for equities which will be worse than 2008.

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