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Short Squeezeability Of Two Main Market ETFs Slides To Multi Year Lows

Tyler Durden's picture




 

Exactly one year ago, the short-interest in SPY (the S&P 500 ETF) reached epic heights at over 536mm shares. At the same time, short-interest in QQQ (the Nasdaq ETF) also short-term peaked at over 116mm shares short. While QQQ has seen a gentle drift lower in general (somewhat reflective of trading volumes in the last few years), since July of last year SPY has seen a 62% drop in short-interest and QQQ 59%. QQQ short-interest is now its lowest since October 2000 and SPY short-interest its equal lowest since October 2007 and so ammunition for charging this market higher seems to be running out. This is even more highlighted by the 45% and 30% plunge in QQQ and SPY short-interest in the last six weeks alone.

 

 

Data: Bloomberg

 

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Tue, 08/07/2012 - 11:33 | 2684810 vast-dom
vast-dom's picture

these will go parabolic.

Tue, 08/07/2012 - 11:35 | 2684819 French Frog
French Frog's picture

After everything we've seen in the last 3 years, surely there isn't anyone left who believes that they actually need short-covering to gun this market higher....

Tue, 08/07/2012 - 11:51 | 2684880 aint no fortuna...
aint no fortunate son's picture

and a collapsing VIX compliments of the bernank's new head trader

Tue, 08/07/2012 - 12:03 | 2684917 vast-dom
vast-dom's picture

it makes perfect sense actually: jobs are strong; P/E strong; commodities cheap; savers have disposable income; QE has saved the economy; housing has completely recovered; ZIRP more at NIRP is really moving things along; bonds are beautiful.

Tue, 08/07/2012 - 14:26 | 2685313 Haager
Haager's picture

There must be some guy who's killed by irony.

Tue, 08/07/2012 - 11:35 | 2684823 LawsofPhysics
LawsofPhysics's picture

Meanwile, somewhere in the basement of the Eccles building - "No one can be allowed to profit from the next take down.  So it is written, so shall it be."

Tue, 08/07/2012 - 11:38 | 2684840 theTribster
theTribster's picture

So let it be written, so let it be done. Ramses II.

Tue, 08/07/2012 - 11:39 | 2684843 Nid
Nid's picture

Preach it!

Tue, 08/07/2012 - 11:55 | 2684887 q99x2
q99x2's picture

Ozymandias

Tue, 08/07/2012 - 11:47 | 2684860 DeadFred
DeadFred's picture

No one other than Goldman and friends, that is.

There is a strong cap on this thing at SPY 146 or so. Stay on the sidelines and wait for the blowout high.

Tue, 08/07/2012 - 11:36 | 2684824 slaughterer
slaughterer's picture

Bidermann is the only one holding QQQ/SPY short at this point.  Please post a video of him tonight.  I need to see his justification for his 100% short position to gauge how insane he is.  

Tue, 08/07/2012 - 11:36 | 2684827 FRBNYrCROOKS
FRBNYrCROOKS's picture

I'm still short and it's killing me. The minute I cover the SnP will drop below 1000. I just can't bring myself to cover. After I cover I am going strickly matress for my savings.

Tue, 08/07/2012 - 11:44 | 2684857 ThunderingTurd
ThunderingTurd's picture

I am with you crooks.

Tue, 08/07/2012 - 12:07 | 2684935 Sofa King Confused
Sofa King Confused's picture

WHAT IF??

 

What if the stock market is just like the banking system.  All stock transactions are cleared through the DTCC ( Depository Trust & Clearing Corporation).  If banks can take $1000 on deposit and leverage it up to loan out 30, 40, 50 or 100 thousand dollars that are made up out of nowhere; what makes anyone think that the stock market is any different.  I'd be willing to bet that there are only 10 or less real shares of any company out there for every 100 sold.  Remember its all a rigged game, they can increase or decrease the imaginary shares as needed.

Tue, 08/07/2012 - 14:27 | 2685331 Nels
Nels's picture

What if?  You need to read the story of 'the Miscreants Ball',  on the deepcapture.com site.  The only question is how much of this bad behavior exists, not if.

Tue, 08/07/2012 - 12:20 | 2684983 ExhiledInMass
ExhiledInMass's picture

posted this above but meant to reply directly to you previously Crooks...

 

Crooks

I'm exactly where you are...as I've told friends it feels like I'm living in an alternate universe watching what's going on... it feels better that I know that at least there are two other travelling in parralell (sp) with me ...you and TT

Tue, 08/07/2012 - 15:30 | 2685569 Plymster
Plymster's picture

Judging by the "ups" that Crooks has gotten, I'd wager there are more than just you 3 and me out there still short.  After four years of unabashed fraudulent pumping, it's killing me, too. 

Tue, 08/07/2012 - 12:30 | 2685023 long-shorty
long-shorty's picture

are you short all the way from S&P 1000?

Tue, 08/07/2012 - 14:06 | 2685276 theTribster
theTribster's picture

Yea, fear not - this market will crash much harder and faster than the recent metoric rise. Especially considering that soon everybody will be pulling thier cash out of everywhere they have it and putting in their mattress (or trying to buy Gold and Silver) too. The world is so upside down its ridiculous, run by liers, cheats and greedy thieves. The problems are so fundamental and systemic that a major crash is abolsutely inevitable, manipulation only works for so long and we are about to hit that wall.

Geitner went over to make sure that the Europeans understood that they have to keep things together through the next election otherwise he would have to cut off some of the help - to think that this is all happening in Europe without the Fed and the Treasury involved is naive, last week simply tied politics to finances more overtly. Can they hold it together past November? Yep, our gubmint will make sure with back room deals - they (Europe) will leverage this as much as possible because Obama is willing to buy the election (as any other Pres would), no matter what it costs the American public.

Walking on a razorblade is what's happening, eventually there will be  a slip somewhere that will generate a lot of blood and make it slippery for everybody else (sovereigns I mean) - this will be the start of a rapid decline in confidence, the is already building momentum as more and more financial shenanigans are coming to light (Kinght most recent). Its almost a daily occurence at this point. The CFTC recently said the Sivler market is not manipulated, its all good they said. Anybody paying attention knows whats happening or at least has a sense that things are out of control.

This shit always seems to go on longer than it should and that is certainly the case now, how much longer before enough is enough and the people demand change? I think it is the next market crash which is coming if not beofre than immediately after the elections - this is planned destruction (and transfer) of wealth - they know what their doing, this isn't happening because people at the central banks are stupid. On the contrary, they are driving the economies to exactly where they want them and doing it via exactly (more or less) the route they want to take.

The next crash will kill the retiring baby boomers investments, reducing their wealth by as much as 75%. Then the dollar will be devalued, reducing their wealth even more. Commodities will continue to go higher as the banks and markets define their prices, stealing yet more wealth. Medicare and Medicaid and Social Security will be greatly reduced and more of the financial responsibility put on the retiree. Its going to get so ugly for people, 100s of times worse than it is right now.

I like the matress idea, its one I adhere to as well. There will be a time where any money in the system is completely controlled by someone other than you, at that point its too late. You might consider some dollar cost averaging to get out of the positions sooner than later. Good luck getting out.

 

Tue, 08/07/2012 - 11:39 | 2684841 buzzsaw99
buzzsaw99's picture

Like playing poker when the other players can see your hand. Fools.

Tue, 08/07/2012 - 11:39 | 2684845 kaa1016
kaa1016's picture

With the central banks not willing to let markets drop more than a few percent, anyone shorting this market without option hedges is out of their minds.

Tue, 08/07/2012 - 11:40 | 2684848 hedgeisforpussies
hedgeisforpussies's picture

ALL BEARS PLEASE COVER SO I CAN GO SHORT. EVERY MUM AND PUP IS SHORT. 

Tue, 08/07/2012 - 11:44 | 2684858 hedgeisforpussies
hedgeisforpussies's picture

If sp cash closes above 1405 bye bye shorts. nothing to stop 1420 and 1450. 

Tue, 08/07/2012 - 11:44 | 2684859 magpie
magpie's picture

I am short, and will remain so until the 10 year hits 5 %.

Tue, 08/07/2012 - 11:49 | 2684861 Seize Mars
Seize Mars's picture

Stop playing this game. Get out now.

As Ann Barnhardt would say, "Stop trying to trade the end of the world."

 

Tue, 08/07/2012 - 11:50 | 2684864 JustObserving
JustObserving's picture

Completely manipulated markets and people want to short them?  That is more than a little insane.

When was the last time we had honest markets in the US?

Tue, 08/07/2012 - 12:08 | 2684936 scatterbrains
scatterbrains's picture

Dice rollers believe the collapse will come in a series of slices. If you can catch the first couple of crashes then you can score.. unless the market one day just never opens again. 

Tue, 08/07/2012 - 11:48 | 2684871 The Axe
The Axe's picture

Salesforce went through its 50/200 moving average like a hot knife though butter....not a seller in sight.....market is rpping higher...

Tue, 08/07/2012 - 11:51 | 2684881 buzzsaw99
buzzsaw99's picture

it takes two to tango

Tue, 08/07/2012 - 14:18 | 2685308 Haager
Haager's picture

2nd is robo.

Tue, 08/07/2012 - 11:50 | 2684875 Meesohaawnee
Meesohaawnee's picture

and Bens short ban still remains in effect. The stats prove it.

Tue, 08/07/2012 - 11:50 | 2684876 earleflorida
earleflorida's picture

a bidless market has but one direction -- a giant backwardation sucking sound, where not even a plunger for protection can save you from drowning in illiquidity...

Tue, 08/07/2012 - 11:50 | 2684877 dracos_ghost
dracos_ghost's picture

Don't underestimate the "geniuses' in the pension space. As soon as they see a herd stampede, they'll jump in converting cash/bond positions to equities in a blink of an eye. And it's coming up towards end of FY + Obama re-election gambit by Wall Street so there is definitely enough ammo for a blowoff. I think it may be premature to say end to the irrational exuberance.

That being said, once all these flotation devices (election, EU, QE to Infinity) lose air, watch out below.

Tue, 08/07/2012 - 11:54 | 2684885 qussl3
qussl3's picture

How convenient for insiders to offload before the capital gains tax increase.

Tue, 08/07/2012 - 11:54 | 2684888 Meesohaawnee
Meesohaawnee's picture

why isnt Romney all over this blatant pro obama manipulation?? or is he and is camp that stupid??

Tue, 08/07/2012 - 12:12 | 2684950 magpie
magpie's picture

They can always short 2-year bonds and go long oil.

Tue, 08/07/2012 - 12:17 | 2684965 LMAOLORI
LMAOLORI's picture

 

 

"why isnt Romney all over this blatant pro obama manipulation??"

Good question he did say he would get rid of ben and..

 

 

Romney says Fed should not enact new stimulus measures

http://thehill.com/video/242251-romney-says-fed-should-not-enact-new-stimulus-measures

 

 

check this out

 

 

Fed’s Rosengren Urges ‘Open-Ended’ Easing Program

http://www.bloomberg.com/news/2012-08-07/fed-s-rosengren-urges-open-ended-easing-program.html

 

Tue, 08/07/2012 - 14:13 | 2685293 Haager
Haager's picture

He absolutely has no clue. He talked about abolishing the fed afaik, but gave no reason or insight.

He could also act on the fact that the government actually gives money to terrorists, whether direct or indirect - but nothing.

He could talk about the situation on the housing market and the shift from fulltime to parttime work - nothing.

The only ones talking about these issues are Paul, Kucinich and some other libertarians.

Tue, 08/07/2012 - 11:55 | 2684891 GoldbugVariation
GoldbugVariation's picture

The rise in the oil price is causing the S&P to rise on the strength of oil cos, which is dragging European stock indices and all other risk assets up with it.

However, there will not be any QE3 or ECB bond purchases when oil and equities are as high as this.

The big boys want QE3 to happen.

Therefore, this market is going to collapse by the end of August.  100-150 points to come off the S&P.

Also with short interest this low, today is an ideal entry point for shorts.

(Of course, people who are already short are probably at maximum pain today, so their perspective will be different.)

Tue, 08/07/2012 - 11:58 | 2684898 slaughterer
slaughterer's picture

My daily short medicine: I short at 3:45pm only for 15 minutes every day.  

Tue, 08/07/2012 - 12:23 | 2684998 ExhiledInMass
ExhiledInMass's picture

not maximum yet...but getting close!

Tue, 08/07/2012 - 12:32 | 2685029 vast-dom
vast-dom's picture

correct goldbug. 

Tue, 08/07/2012 - 14:19 | 2685310 dracos_ghost
dracos_ghost's picture

The big boys want QE3 to happen.

 

Except QE is basically about forced credit expansion. A war would be easier to socialize to the masses at this point than a strict QE style gambit. Same effect. Iran probably has some cake in their shorts right now.

Tue, 08/07/2012 - 15:38 | 2685589 Plymster
Plymster's picture

The rise in the oil price is causing the S&P to rise on the strength of oil cos...

Remember back when the market worked, and a rise in the price of oil was BAD for the economy because it meant that input costs were increasing, and taking a mammoth bit out of profits?  Seems like so long ago...

Tue, 08/07/2012 - 11:58 | 2684897 pleseus
pleseus's picture

A market top is in.  Look for the high tick tomorrow.  Reversal on Thursday.

Tue, 08/07/2012 - 12:00 | 2684905 slaughterer
slaughterer's picture

Upper BB on the weekly is still a good 20 S&P points higher.  No high is in yet until we hit about 1425-1430.  

Tue, 08/07/2012 - 12:04 | 2684921 razorthin
razorthin's picture

Maybe, but new highs will be accompanied by weekly negative divergence (MACD will not confirm).

Tue, 08/07/2012 - 12:38 | 2685057 Hype Alert
Hype Alert's picture

That should only take a day or two.

Tue, 08/07/2012 - 12:00 | 2684904 Shizzmoney
Shizzmoney's picture

Good piece by Josh Brown:

http://www.thereformedbroker.com/2012/08/07/american-idle-five-reasons-we-hate-the-stock-market/

The perception that it's all rigged might have something to do with the fact that every time investors are beckoned back in, usually toward the tail-end of a Fed-induced liquidity-binge rally, they are sucker punched.  A mechanical arm with a boxing glove on the end shoots out of their computer screen and bashes them right in the crotch.  Again and again and again.  And yet the same motherfuckers appear in the finance category of the Forbes 400 year after year. Grinning like bastards, their eyes mocking you.

Wouldn't you think it's rigged, too?

Tue, 08/07/2012 - 12:00 | 2684907 HaroldWang
HaroldWang's picture

Odd, Bob Pisani just told us that short interest was at its highest level in months and no one believes in this rally.

One of you is wrong. And seeing how the market continues higher unabated, I think I gotta side with Bob on this one.

Tue, 08/07/2012 - 12:05 | 2684927 Central Bankster
Central Bankster's picture

right, because you cant use your eyes to look at a graph you lazy bastard?

Tue, 08/07/2012 - 12:09 | 2684941 HaroldWang
HaroldWang's picture

I see lots of charts, especially the ones that keep going higher. YOU may want to look at those charts - that's where the market continues to go and where the money is being made.

Tue, 08/07/2012 - 14:33 | 2685352 Central Bankster
Central Bankster's picture

YAH like that CMG chart where it was going up, well that is until it gapped down 20%.  Yep owned lots of OTM puts that, more than enough to pay for these squeeze days that idiots like you seem to have trouble understanding.

Tue, 08/07/2012 - 17:22 | 2685842 Central Bankster
Central Bankster's picture

Oh man another homerun.  PCLN puts gonna pay big tomorrow.  AHAHA clueless bulls get slaughtered.

Tue, 08/07/2012 - 12:35 | 2685048 credittrader
credittrader's picture

Saw same thing - no idea what Pisani is looking at...here is NYSE Short Interest -even ratio is a long way from 5 year highs and its plunging recently... http://www.nyse.com/press/1343126100709.html

Tue, 08/07/2012 - 12:05 | 2684924 CheapBastard
CheapBastard's picture

Stock market, like housing, is a Death Trap for the Sheeples and Muppets.

Tue, 08/07/2012 - 12:13 | 2684954 Blopper
Blopper's picture

Who dares, sells.

Tue, 08/07/2012 - 12:16 | 2684962 Marty Rothbard
Marty Rothbard's picture

I'm beginning to think that the only profitable way to bet against these markets is PMs.   The manipulators have to lose control at some point, don't they?  Number of workers employed down, corporate profits down, taxes up, dollar up, oil up, next to no volume, what does it take? 

   So many short positions, gives the PTB the perfect opportunity to go short nearly instantaneously, crash the market, and own the world, doesn't it?  Deflation doesn't look so bad, when your pockets are full of dollars.

   My short positions are killing me, but I can't bring myself to close them, with everything screaming CRASH.  `Oh well, I guess these capital losses, will come in handy, once I take some profits.   Damn you, ChairSatan.  How does someone from Florence, South Carolina(a nice little town) get so evil?  Destroying price discovery in every market in America, is just wrong! 

 

 

Tue, 08/07/2012 - 12:18 | 2684975 ExhiledInMass
ExhiledInMass's picture

Crooks

I'm exactly where you are...as I've told friends it feels like I'm living in an alternate universe watching what's going on... it feels better that I know that at least there are two other travelling in parralell (sp) with me ...you and TT

Tue, 08/07/2012 - 12:20 | 2684984 Meesohaawnee
Meesohaawnee's picture

Washington just needs to be renamed Bejing. Nothing different. At least the Chinese have the guts to admit to a lie once in a while.

Tue, 08/07/2012 - 12:23 | 2684995 SmoothCoolSmoke
SmoothCoolSmoke's picture

Here's my theory.. SP much lower next 3 weeks........... in time for Jack-ass-son Hole.

Tue, 08/07/2012 - 14:29 | 2685338 MFLTucson
MFLTucson's picture

A fuckin con game.  

Tue, 08/07/2012 - 20:44 | 2686348 Ted Baker
Ted Baker's picture

Fact 9:- Sp5 overbought - Will correct by 175 points btw now and?????

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