QE3 Levitation Day 3... Brings the DJIA To Positive For The Year, In Comic Contrast With The Rest Of The World

Tyler Durden's picture

And so it continues, as it was outlined yesterday, and the day before. There is little to add here: 50 ES points in three days on substantially below average volume (red area chart), robots gunning for VWAP, and nothing but hollow expectations for QE3 despite the clear quandary for the Fed that absent a clear deflationary threat, read a plunge in stocks, it will be very difficult for Bernanke to sell easing to the dissenting votes. The important thing: unlike every other relevant market in the world (Belarus may be a notable exception), the DJIA is now green for the year. In the meantime bonds continue to ignore the whole move in stocks. Of course, if this is just a career protection rally for the end of the month, the reconnection of stocks with gravity tomorrow will be painful. Alternatively, gravity will be even more painful if the Fed does end up disappointing on September 21, which it may have no choice but to do if stocks price all of it in by then.


And an even more amusing relative volume chart: the entire 100 point ES move since the lows has been on below average volume.


And here, once again, is why America is number one... in market manipulation.

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achmachat's picture

I got Queen's "it's a kind of magic" in my head now!

Hugh G Rection's picture

Hidden Camera catches footage of Bernanke and Geithner discussing QE3!!!


john39's picture

very clever of them...  gotta make sure that the market buys it.  

Zeilschip's picture

That's a sweet Panerai! Big dick playa! 

NotApplicable's picture

The phrase "stuck on stupid" jumped into my mind upon seeing the charts.

SmoothCoolSmoke's picture

I'd be rater partial to ELO's "Strange Magic"  myself.

101 years and counting's picture

thats a 56 point divergence for ES?  only question is what day will be the 50 point gap down...trapping all newbie bulls?

sun tzu's picture

Peter Schiff was right about the rest of the world decoupling from the US. He was wrong about which way the respective markets would head

IMA5U's picture

shorting is a moral hazard


stay long my friends

sun tzu's picture

Stay out of the casino

Alea Iactaest's picture

Can someone please explain the divergence between physical and GLD today? Thanks, in advance.

Quinvarius's picture

gld ticker reset is at 4pm.  gold comex reset is at 1:30 pm.  there is no real divergence.  mot yet anyway.

Dick Darlington's picture

Well, i have to say IBEX is fighting the spanish reality pretty well too...

RobotTrader's picture



Bears seem to get shafted every day, because TPTB drives stocks down intraday to keep hope alive.

Lots of guys I know are still clutching TZA, FAZ, etc. sitting on big losses, praying for a steep drop so they can get out.

I know one guy who shorted 1,000 shares of JPM on the big breakdown at $34, he's screaming bloody murder right now.

Sudden Debt's picture

10 put options at 34$? That's only about a 300$ loss.... your friend is high roller he?


LoneStarHog's picture

These two share a cot at the local mission.

TradingJoe's picture

I'm LMAO, Robo just does not get it!

Bill Lumbergh's picture

Let me help you revise that first sentence..."because sellers take profits and TPTB drives stocks up intraday to keep hope alive"...much better now.

Caviar Emptor's picture

Like John Paulson you mean? 

whstlblwr's picture

Glad I don't know RobotTrader, he laughs at others misery and degrades women. wow, 1,000 shares, LOL!

YesWeKahn's picture

Short 1000 shares? He only lost 3.5K, it's SO nothing! On the other hand, if the market did tank, JPM could be a 15$ stock.

Id fight Gandhi's picture

Pfft, some crowd you hang with, big rollers lol. 1k shares? He'll be in the money soon enough.

rocker's picture

Dear Robo, That's what the Elitist Owners of the HFTs do.  They monitor the record short level and say, let's steal their money. A privledge that special software allows them to do. They see all orders and shorts as dollar signs.

With no volume, it is nothing less than a rigged, dishonest market. 

Did you notice how they did manage to get rid of some of their own supply in the afternoon. 

What's a shame is they are scaring off real investors forever.  

Ras Bongo's picture

Robot, you must be one of the few making coins trading among ZH bloggers

Ahwooga's picture

Ras Bongo, back in the kitchen please, Robo needs his dinner cooked for him.

rbsx's picture

This whole process is hilarious.


Good news = Good news = Market goes up

Bad news = QE 3 = False Good News = Market goes up


Maybe I'm one of the few people grounded with reality seeing that QE3 will just inflate everything again, but in the short term (because I've got a lot of shorts out there) I've been taking a beating. I have no clue what's pushing the markets these days.

wang's picture
wang (not verified) rbsx Aug 31, 2011 3:26 PM

  Good news = Bad news

always been the way depending on your perspective

IMA5U's picture

that's right.  

we have a 3 day weekend coming up also.   there will be some government magic going into the weekend.  here's what The Wag The Dog House has to choose from:

  • Ghaddafi & Friends.  We got em right where we want em
  • Merkel blinks an eye.  Eats a gyro
  • The Reconstruction of Irene.  She blew but not that hard.
  • Value investor XYZ eyeing banks.  Doesn't see red.  Sees pink or brown
  • The consmer is not dead.  Long live the consumer
  • Obama jobs bill.  He wants to keep his job and will push stocks higher.
  • Fed always good till close on QE3.  Operation Twisted Sister III commencing
Id fight Gandhi's picture

Id be in there buying too for the easy buck on the QE inflate. Only problem is there's no real hint of it. There's talk that it might come next month, but no real hints of anything. Ben has been very obvious when it comes to this shit, he's holding back. Seems he's passing to Obama for his job shit.

Qe3 will happen, but it ain't going down with the markets up for the year even as we enter recession. I doubt the fed chiefs even notice anything other than the ES anymore.

Sudden Debt's picture



sheeple2012's picture

Wait til they take BAC, GE and CSCO out of the Dow and add AAPL, LULU and CMG... my target: 25,000

agrotera's picture

Any thoughts on how the rats get out this trap they created with thier own catch 22? 

slaughterer's picture

If tomorrow does not close red, then the "Robo-trader Revenge Rally" (RRR) will have stepped into second gear. 

LoneStarHog's picture

Three words:  NOMINAL ... REAL ... GOLD

YesWeKahn's picture

Tyler, the rest of the world will catch up quick like always.

RobotTrader's picture



Crazy tape no doubt.  I remember getting singed on those huge bear market rallies in 2001 - 2002 by holding shorts too long.

Proof that faster money is made in bear markets by trading on the long side, jumping in on oversold conditions.

And the bear market rallies always last longer than most expect, sometimes up to 6 weeks.

rocker's picture

Don't lead people into a Bear Trap. It's too late to jump in now. If your that experienced you know I'm right.

I like to read the news letters of Louis Yamada. Her advise is to sit on the sidelines until it crashes.

And by the way, she is always right and she says it will crash after they drain all the hot money out.

She also likes Gold after it corrects. Probably when the HFT owners crash the whole market.  

Ancona's picture


I LOVE Magic!

Do another trick please!

buzzsaw99's picture

"market" = Kids can bounce on the bed all day long but big fat fannie can't.

Caviar Emptor's picture

Now that Part I of the trillion$ fiscal stimulus package seems fully assured (mortgage refi) (as I been predicting here for 2 weeks), we will soon hear about the rest of it:

Big jobs package, more business tax breaks (extending the payroll holiday and cutting social security contributions), more extension of expanded unemployment payments, and infrastructure bill. And you'll hear it's all "budget neutral" (!)

Meanwhile the Fed will maintain its current stealth QE (ZIRP, QE lite and as Krasting pointed out, MBS turnover due to the refi stimulus). But no QE3. That would be suicidal. 

mendigo's picture

market is being moved by what central planning may or may not do - good luck with that

carbonmutant's picture

I know they're working on antigravity out at Area 51. market acts  like they discovered it...

HUGE_Gamma's picture

adjust world equities to % change in USD

I am Jobe's picture

Fifty Additional Community Banks across the Country Receive $767 Million to Help Small Businesses Access Capital, Create New Jobs


Alpha Monkey's picture

Apart from the 3 banks in CA, and one in CO, it seems like the banks favored were more midwestern and easterly located.  What's the deal with that?

DavidC's picture

Just under 1,000 points on the Dow since the 22nd of August (low to high).

All I do (as,indeed, TD is doing) is reiterate that Bernake WILL NOT, CANNOT, QE3 unless there is a reason to do so, and that does not occur at these current levels. Disappointment is coming somewhere, soon.



Id fight Gandhi's picture


The fed is clearly not showing any public concern over the data sets being dog shit. They claim it will all turn around. Fine, don't cause panic, whatever.