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S&P Futures Gap Up 0.5% -- That Is All

Tyler Durden's picture




 

Asia opens loud and proud and announces itself with a subtle 'buy-every-single-contract-in-the-stack-coz-I-am-desperate' algo grabbing 7000 contracts in S&P 500 e-mini futures (ES). Nothing else moved, just ES. Now a few things are reacting but the total lack of news and sheer ignorance of unloading that much into an illiquid thin market at this time of day suggests this market is more broken than we suspected. Also, since the move is identical to what a certain Bruno Iksil would have done back in March with IG9, when he would sell through all the bids, only this time in reverse with equities, we wonder if the "water walking" Frenchman may not have already found his next port of call.

Note the total lack of follow-through in any othe risk-asset...

as a 6-7000 car trade grabs everything in the stack and lifts us 6 points higher on a 'stop-run'...

 

Charts: Bloomberg

 

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Mon, 08/13/2012 - 21:21 | 2702681 baby_BLYTHE
baby_BLYTHE's picture

biggest bubble in the history of equities predicated on nothing other than hot air rhetoric from central economic planners.

Mon, 08/13/2012 - 21:45 | 2702769 slewie the pi-rat
slewie the pi-rat's picture

ahem... let me take a turn baby_B!

...earnings?

Mon, 08/13/2012 - 22:00 | 2702812 baby_BLYTHE
baby_BLYTHE's picture

relatively flat to declining. Nothing to brag about nor anything to justify current asset prices.

Mon, 08/13/2012 - 22:33 | 2702860 slewie the pi-rat
slewie the pi-rat's picture

should mean lotsa work fror their accountants

enjoy the convention!

or is that a ?

like anybody needs any more babyBlackHelicopters at this point?

 

Mon, 08/13/2012 - 23:24 | 2702950 ACP
ACP's picture

Just an intern at the Fed trying to impress his boss.

Son, keep it up and one day you'll be buying big S&Ps...

Mon, 08/13/2012 - 23:44 | 2702972 The Monkey
The Monkey's picture

Higher prices baby !  Yeah.

Tue, 08/14/2012 - 00:09 | 2703003 flacon
flacon's picture

Years of uncopulated QE promises makes a virgin in heat. 

Tue, 08/14/2012 - 01:05 | 2703065 Dr Benway
Dr Benway's picture

It's not price manipulation if it's upwards. It's not fraud if it's condoned by regulators. It's not wrong unless you get caught.

Mon, 08/13/2012 - 22:13 | 2702830 Everybodys All ...
Everybodys All American's picture

take out inflation and especially a large number of bank's mark to mythology accounting from those earnings and you have a train wreck don't ya think.

Tue, 08/14/2012 - 02:43 | 2703073 LibertarianX
LibertarianX's picture

btw...wait until someone takes a close look at the Mark IT circular marks for all the derivatives 'unobsevable parameter' marks used for implied correlations and vol.....

Libor will look saintly I suspect....

Mon, 08/13/2012 - 22:18 | 2702840 Eireann go Brach
Eireann go Brach's picture

I see Obama opened up a Scottrade account and is putting everything on the Presidential EBT Unlimited Food Stamp card!

Tue, 08/14/2012 - 00:51 | 2703052 ebworthen
ebworthen's picture

You took the words out of my mouth, and I'm happy for it.

Bubble, bubble; part deux (or is it tres?)

Tue, 08/14/2012 - 06:51 | 2703197 DeadFred
DeadFred's picture

They systematically tried to drive volume out of the market and succeeded. Now that they own the game they wonder "What can I do with this?" I think a lot of the wierd algo actions are really probes to test how their wholey-owned system reacts. Sooner or later they'll find the optimum way to extract the wealth out of everyone else still in the game. Those pension funds do look tasty, right?

Tue, 08/14/2012 - 11:57 | 2703945 ebworthen
ebworthen's picture

CALPERS...mmmmmm.....

Mon, 08/13/2012 - 21:24 | 2702687 The Axe
The Axe's picture

i thought the NY Fed is out drinking this time of day...perhaps the cleaning lady sat on the keyboard...shit it only has buy keys.....

Mon, 08/13/2012 - 22:32 | 2702780 slewie the pi-rat
slewie the pi-rat's picture

 <--< DSK knows her

 <--< chaseMorgueCHINA

[choose one and vote:  coincidence?  or cause?  L0L!!!]

Mon, 08/13/2012 - 21:24 | 2702688 1fortheroad
1fortheroad's picture

Yea baby, Simon says jump motherfucker.

I did see the reaction on the dow mini, up 25 points in a split second. 

Just happen to be looking on my tick chart. 

Mon, 08/13/2012 - 21:25 | 2702693 francis_sawyer
francis_sawyer's picture

Prechter & Neely will be along any minute now to explain this...

Mon, 08/13/2012 - 22:00 | 2702811 slewie the pi-rat
slewie the pi-rat's picture

i wonder if tyler has banned robo again?

Mon, 08/13/2012 - 22:11 | 2702827 slewie the pi-rat
slewie the pi-rat's picture

here is the graphic representation, from slewienomics:

Elvira V. VWAP

Tue, 08/14/2012 - 11:59 | 2703953 ebworthen
ebworthen's picture

Tittie Talent - more impressive than any algo!

Mon, 08/13/2012 - 21:26 | 2702698 mammoth mo
mammoth mo's picture

Well - zombie banks never sleep.

Mon, 08/13/2012 - 21:26 | 2702700 goldencross10
goldencross10's picture

Yep anyone who had stops at 1,407 got screwed, more signs of broken market structure.

Mon, 08/13/2012 - 21:32 | 2702717 ghengis86
ghengis86's picture

1. Who is still using stops?
2. Who is still "in" this market?
3. Who's in the market for a slightly used bridge in Brooklyn?

Mon, 08/13/2012 - 21:38 | 2702744 Bear
Bear's picture

Who is using stops? Do you think that the market jumped on a long and considered evaluation of the fundamentals of the economy?

I am a Bear and I thought that SP was overvalued at 420 ... I am short when ES goes above 1400 and VXX about 11. I willl continue to be wrong until I am suddenly right.  P.S. I would love to own the Brooklyn Bridge, is it up for sale?

Mon, 08/13/2012 - 21:49 | 2702776 ghengis86
ghengis86's picture

Why yes it is! My broker is the Honorable John Corzine, so if he asks for the funds to be deposited with him for holding while the transaction closes, you can rest assured that your money is safe. The account is segregated!!

Tue, 08/14/2012 - 00:48 | 2703048 Mugatu
Mugatu's picture

Ghengis,

 

You questions are easily answered:

1. Who is still using stops? - Computers
2. Who is still "in" this market? -  Lots of Computers
3. Who's in the market for a slightly used bridge in Brooklyn? -  The guys who own all these computers.

Now, does it all make sense now?  Now that you understand what is going on, you can be as fucking confused as everybody else.

Tue, 08/14/2012 - 03:52 | 2703131 trebuchet
trebuchet's picture

You're right, with low volume, illiquid markets, the stop hunters have a disproportionately larger role in price setting... 

.. the basic algo is sine wave, VWAP reverting with variance -volume triggers for turning points

so you want to be cash with ridiculous low limit buys and high sells and surf that wave baby!!!

 

e.g. ABG in UK, KMR  have the hallmarks of stop hunting algos driving daily price action

Mon, 08/13/2012 - 21:33 | 2702720 Bear
Bear's picture

1407.25 just what you want ... buy at the top of the six month market in the middle of the night

Mon, 08/13/2012 - 21:38 | 2702742 roadsnbridges
roadsnbridges's picture

With this moronic market, I suggest 1450.

Mon, 08/13/2012 - 21:27 | 2702702 DavidC
DavidC's picture

Broken doesn't even begin to describe this.

DavidC

Tue, 08/14/2012 - 00:28 | 2703022 SheHunter
SheHunter's picture

Market's become a spectator event. Watch from afar with beverage in hand marveling at the HFT antics.

Mon, 08/13/2012 - 21:29 | 2702708 DavidC
DavidC's picture

...And I'm inclined to say that when this breaks properly, and it will, these bastards are going to deserve everything that's coming to them.

DavidC

Mon, 08/13/2012 - 21:39 | 2702746 roadsnbridges
roadsnbridges's picture

Sure it will.  Now I;m looking at VXX at 5 to go all in.

Tue, 08/14/2012 - 00:13 | 2703009 flacon
flacon's picture

Aug 18 calls are torn to shreds. Go for September or October incase this insanity takes a while longer. 

Mon, 08/13/2012 - 21:45 | 2702767 mammoth mo
mammoth mo's picture

When it breaks those bastards will have the other side of the line.  Having beat it down to next to nothing - they will make a fortune as mom and pops retirement goes up in smoke.  They will cry they are poor now but it will be a lie all along.

Mon, 08/13/2012 - 21:49 | 2702778 DavidC
DavidC's picture

Unfortunately I think you're right mammoth mo.

DavidC

Tue, 08/14/2012 - 00:12 | 2703007 flacon
flacon's picture

Mom and Pop need to get off their ass, turn off the TV and protect their birth-right before it gets legally stolen. Too bad they hired the thief to guard their hen house. Too bad... So sad... you snooze, you looze. 

Tue, 08/14/2012 - 06:55 | 2703199 CPL
CPL's picture

Their birth right was never a central banking system...ever.

Mon, 08/13/2012 - 21:53 | 2702795 Dr. Engali
Dr. Engali's picture

And they all will say .... "nobody could have seen this coming "

Mon, 08/13/2012 - 21:31 | 2702716 Bear
Bear's picture

I can't believe how 'valuable' those ES contracts are .... you'd think they were gold

Mon, 08/13/2012 - 21:35 | 2702718 russwinter
russwinter's picture

Open interest in VXX futures are near record highs, the inverse of stock index futures. If there is a wild assed whale (Moby Dick) or whales I suspect that is where he is lurking.

http://seekingalpha.com/article/802871-please-sir-may-i-have-some-volatility

Mon, 08/13/2012 - 21:41 | 2702750 roadsnbridges
roadsnbridges's picture

He who buys first, loses most.

Mon, 08/13/2012 - 21:52 | 2702787 Sam Clemons
Sam Clemons's picture

He who buys on leverage, is TBTF, and has mark to myth accounting loses nothing.

Mon, 08/13/2012 - 21:44 | 2702759 aint no fortuna...
aint no fortunate son's picture

His name is ben. One more buy like this and they should open VIX tomorrow in the 12's

Mon, 08/13/2012 - 21:35 | 2702735 Xibalba
Xibalba's picture

seek.destroy.exe

Mon, 08/13/2012 - 21:35 | 2702736 roadsnbridges
roadsnbridges's picture

I am so sick of this CIT.

Might get some exits outta it.  Fing HL.

Mon, 08/13/2012 - 21:37 | 2702740 holdbuysell
holdbuysell's picture

Did someone start printing again? The last five or so days of a steady low volatility upward march looks an awful lot like previous print-fests' marches.

Are those reverse repos conducted by the Fed really only a few hundred million?

Mon, 08/13/2012 - 23:14 | 2702939 Dr. Engali
Dr. Engali's picture

It doesn't take much to levitate a market as illiquid as this is.

Mon, 08/13/2012 - 21:38 | 2702743 buzzsaw99
buzzsaw99's picture

yes we have no bananas

Mon, 08/13/2012 - 21:44 | 2702755 roadsnbridges
roadsnbridges's picture

Typical Goobermint.  Now I have no clue where my next daiquiri will come from.

 

uurrrppp

Mon, 08/13/2012 - 21:44 | 2702761 max2205
max2205's picture

Does this mean GRPN will go open Tuesday at $10.00? Rotf

Tue, 08/14/2012 - 06:57 | 2703203 CPL
CPL's picture

It's down 20% PM.

 

Not for any other reason it's a shitty and stupid idea.  How many ways can the coupon book scam be reinvented?

Mon, 08/13/2012 - 21:45 | 2702763 orangegeek
orangegeek's picture

0.5% gap up?  That's enough excitement to leave behind "one on the cotton".

Mon, 08/13/2012 - 21:45 | 2702764 Dr. Engali
Dr. Engali's picture

Shit just gap it to 1525 and get it over with.

Mon, 08/13/2012 - 21:48 | 2702773 roadsnbridges
roadsnbridges's picture

Yee-Hah!  Do it, Ben!  I double dog dare ya!

Mon, 08/13/2012 - 22:26 | 2702862 Tsar Pointless
Tsar Pointless's picture

Patience, good doctor, patience.

Give it another month, and you'll see the 1500-mark successfully attained.

Tue, 08/14/2012 - 07:35 | 2703242 bluemaster
bluemaster's picture

no it is to low   target is 1587

Mon, 08/13/2012 - 21:45 | 2702770 roadsnbridges
roadsnbridges's picture

Any longs left to use this opportunity to exit?  I see S at 5.30, but I also see dead people.

Mon, 08/13/2012 - 21:50 | 2702781 ekm
ekm's picture

Well, warehouse seems to be full and this might be an "unloading trial".

Mon, 08/13/2012 - 21:52 | 2702788 roadsnbridges
roadsnbridges's picture

Yep, have a crap IRA left to unload.  It may be time for the call.

Mon, 08/13/2012 - 21:51 | 2702785 LeisureSmith
LeisureSmith's picture

OT. but i was just checking out Nasdaq After Hours to find out what Groupon finally ended on (-19.74pct) then i saw Envivio ended down a cool 43.66pct, Yikes.

Mon, 08/13/2012 - 21:56 | 2702794 roadsnbridges
roadsnbridges's picture

BTFD, bitchez!

 

It sounds sexy.

Mon, 08/13/2012 - 21:52 | 2702790 This is the end
This is the end's picture

How long can this go on? A lot longer than I am solvent or sane! With:

  • Swiss 2-Yr bonds at negative -0.50%
  • US 10-Yr Yields at 1.6%
  • Gas over $3.50
  • Annual deficits of over a trillion dollars
  • GDP at 1% and declining (and that's all we can muster with all of this borrowing!)
  • Obama creating more disabled people than jobs (more people added to SS disability rolls than jobs created under Obama)

If the S&P fell to 1000 in the next 2 months it would all seem to make a lot more sense!

Mon, 08/13/2012 - 21:59 | 2702798 roadsnbridges
roadsnbridges's picture

I need 400 to just break even.  Shorting this pig for 3 yrs really wasn't a good idea.

TG for FX.

Mon, 08/13/2012 - 21:53 | 2702793 caimen garou
caimen garou's picture

sorry, me and my fat finger!

Mon, 08/13/2012 - 21:55 | 2702799 Jay_Son
Jay_Son's picture

Copper (HG) futures have been doing exactly this for the last few weeks, then stopped the last few days...maybe this game has been transferred to ES?

Mon, 08/13/2012 - 22:26 | 2702863 hyper-critical
hyper-critical's picture

Overlay a chart of tsy's w/ usd/cny.

Mon, 08/13/2012 - 21:59 | 2702805 dwdollar
dwdollar's picture

At least the USDA is going to buy more meat with more printed money. I'm sure that'll help keep food inflation down.

http://www.dailymail.co.uk/news/article-2187684/Department-Agriculture-B...

Mon, 08/13/2012 - 22:02 | 2702814 roadsnbridges
roadsnbridges's picture

Oh, did the USDA discover jerky?

By the time that hits the proles, it will be rotten, suitable for a Netanyahu dinner.

Mon, 08/13/2012 - 22:04 | 2702817 TideFighter
TideFighter's picture

Somebody over at Goodwill turned on a donated Wadell and Reed computer. 

Mon, 08/13/2012 - 22:15 | 2702834 bobert
bobert's picture

I've a question:

Looking at the chart of the ES I see a double peak that looks like a silhouette of Batman's head.

What's it mean???

Mon, 08/13/2012 - 22:18 | 2702843 Manthong
Manthong's picture

Maybe he's getting ready to call out the Joker.. God knows that's who is in control of the markets now.

Mon, 08/13/2012 - 22:52 | 2702906 bobert
bobert's picture

Yeah, I understand.

I'm no technician but when I see that silhouette histroy tells me something is about to drop!

I'm still interested in a technician's insight on this.

Is that an inverse head and shoulder, a double top, or just my imagination?

 

Mon, 08/13/2012 - 22:18 | 2702838 govttrader
govttrader's picture

hey smart people..this is was the headline that the algos jumped on

*BOJ RELEASES MINUTES FROM JULY 11-12 MEETING IN TOKYO
*BOJ MEMBERS SAY THEY HAVE BEEN PURSUING POWERFUL EASING

Unfortunately, the "powerful easing" was simultaenously INCREASING its asset-purchase facility to 45 trilloin yen from 40 trilloin yes...while DECREASING its loan facility to 25 trillion yen from 30 trillion yen.  So in other words...they didn't do anything.  But they did talk about maybe doing something in the future.

Board members said the bank has been “pursuing powerful monetary easing” and would “continue to conduct monetary policy in an appropriate manner.”

Long story short...this move is a FADE

http://govttrader.blogspot.com/

Mon, 08/13/2012 - 22:35 | 2702883 hyper-critical
hyper-critical's picture

Except you missed when, a few weeks ago, the BOJ said new policy action was pending this report. Given how laughably off they were in their estimates (<0 nominal gdp), it's looking more like go time. And there are several other compressed situations that could end up being the butterfly, from a spike in US rates, to repatriation-caused CNY appreciation (some serious stress in their banking system), to __________ insert any of the numerous ways the rate derivatives market looks like it wants to break.

Mon, 08/13/2012 - 22:43 | 2702893 govttrader
govttrader's picture

The BOJ monetizes the Japanese debt...thats just what they do.  If anybody thought they wouldn't print some more Yen so they could "lend" it to the Japanese govt to spend...well thats just silly.  I guess what i'm implying is...this is not "news," and IMO, the safe trade is to buy US Treasuries.  I'm pretty sure i said that somewhere...

http://govttrader.blogspot.com/

Mon, 08/13/2012 - 23:02 | 2702923 hyper-critical
hyper-critical's picture

Gotcha, wasn't clear what you were suggesting to fade. Because I do think this could be an important moment for usd/jpy, cny, asian funding markets, and the entire collateral-starved derivatives complex. Things getting very chaotic underneath the surface

Mon, 08/13/2012 - 22:24 | 2702856 vertexa
vertexa's picture

 

Max Keiser gives date for financial Armageddon

No later than April of next year when the US government has billions and billions of shortfall in tax receipts as Americans can not pay or do not owe taxes.

 

Mon, 08/13/2012 - 22:28 | 2702870 Tsar Pointless
Tsar Pointless's picture

Superb! Now I know when the S&P will set an all-time high of 1600!

Thanks, Max!

Mon, 08/13/2012 - 22:39 | 2702892 surf0766
surf0766's picture

Why would max ever wrtie something and title it "trust no one over 30".  Interesting title.

Mon, 08/13/2012 - 23:39 | 2702966 Jena
Jena's picture

Nostalgia.

Mon, 08/13/2012 - 22:38 | 2702888 vbone
vbone's picture

bounce coming off bros, this a dangerous market fro they bros, bro!

Mon, 08/13/2012 - 22:39 | 2702891 kmichael
kmichael's picture

Ready... set... short!

Mon, 08/13/2012 - 23:01 | 2702920 Dr. Engali
Dr. Engali's picture

It's too bad Ben doesn't just give us his year end target for the S&P and mark everybodies statement accordingly.

Mon, 08/13/2012 - 23:33 | 2702959 pleseus
pleseus's picture

Somebody is desperate.

Mon, 08/13/2012 - 23:34 | 2702961 monopoly
monopoly's picture

This is getting so old. And we are not even close to the implosion. But we are moving in the correct direction.

Mon, 08/13/2012 - 23:36 | 2702963 vbone
vbone's picture

vbone trying to put pieces together lately, but they market is a 1 million piece jigsaw puzzle, it hurt they brain bro!

Tue, 08/14/2012 - 00:50 | 2703049 ebworthen
ebworthen's picture

I'm going to get a huge jar of bubbles and put the Bernanke's picture on it.

Tue, 08/14/2012 - 01:53 | 2703085 q99x2
q99x2's picture

Prediction time. Q99x2 predicts that members of the Rothschilds and Rockefellers will be put on trial  and found guilty of financial terrorism.

So let it be written . So let it be done.

Tue, 08/14/2012 - 03:11 | 2703121 Seorse Gorog fr...
Seorse Gorog from that Quantum Entanglement Fund. alright_.-'s picture

Although the 2nd Baron de Rothschild was a Zionist who helped fuck up Palestine... he did have a monkey dinner party...

 

http://www.youtube.com/watch?v=05LZ_HBTaHM

 

That is all.

Tue, 08/14/2012 - 03:02 | 2703117 YesWeKahn
YesWeKahn's picture

People never commit moey for no reason. Apparently the german gdp numbers have been leaked hours before release. Yes, when big money buy with inside informatiom, they make money, everybody else goes to jail. This is so called democracy and freedom.

Tue, 08/14/2012 - 04:42 | 2703146 Scalaris
Scalaris's picture

Long TVIX.

For Sparta.

Tue, 08/14/2012 - 06:56 | 2703200 Colonel
Colonel's picture

Greedy fuckin gooks.

Tue, 08/14/2012 - 07:16 | 2703221 bluemaster
bluemaster's picture

Banks not even bother to hide manipulation anymore ...

MATRIX

Tue, 08/14/2012 - 08:04 | 2703262 petolo
petolo's picture

Waiting for 1929 and Godot.

Tue, 08/14/2012 - 10:01 | 2703590 chistletoe
chistletoe's picture

clearly,

somebody somewhere had an advance peak at the retail sales numbers .....

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