S&P Options Making Room For Possible Downside

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Tue, 09/20/2011 - 13:35 | 1689407 vast-dom
vast-dom's picture

Too funny! SP at 850 is generous. What levitates up on hot hopium must invariably come down.


Dem popping sounds ain't corks shooting out of Dom bottles in celebration, it's heads pulled out of asses for a 3rd 2nd wind that'll offer a hell of a lot more perspective than O2.

Tue, 09/20/2011 - 13:43 | 1689441 Dr. Engali
Dr. Engali's picture

S&P 400 is where we will find true price discovery.

Tue, 09/20/2011 - 14:37 | 1689618 rocker
rocker's picture

Scumbag Robert Prechter had a UTube vid out this weekend  and free news letter telling all that the rally is over and exhausted.

I wonder if he lost any subscribers today. I hope so. What a scumbag outfit. Cow poop smells better than his words of wisdom, (not).

Tue, 09/20/2011 - 13:32 | 1689409 SparkySC
SparkySC's picture

I'm starting to think Tyler Durden is in fact Mark Haines.

All the CNBC references are starting to add up.

Or sure Mark's gone from CNBC and supposedly the planet, but he just may be trading with Elvis.



I miss the voice of reason that was Haines, I mean Tyler.




Tue, 09/20/2011 - 15:39 | 1689842 RichardP
RichardP's picture

Those monetizing their websites generally go for eyeballs, not reason.

Tue, 09/20/2011 - 13:40 | 1689425 SheepDog-One
SheepDog-One's picture

Last hurrah market pump and short squeeze today before tomorrows down spike on FOMC total disappointment.

Tue, 09/20/2011 - 17:15 | 1689466 baby_BLYTHE
baby_BLYTHE's picture

I still predict QE3 early 2012. It will come about around the same time Greece officially defaults. January 2012 is also when the Bush Tax Cuts expire and might even be the time the Buffett Tax is implemented (pending the legislation is passed). Benocide and the FOMC no doubt figure this into their calculations hoping the tax increases will yield more tax revenue for the government from the money they print and also soften the blow of the double-digit inflation it will produce. It won't work as intend of course just as the other QEs but it has never stopped them.

Tue, 09/20/2011 - 13:59 | 1689502 Mactheknife
Mactheknife's picture

Tomorrow will be a "sell the news" moment no matter the FOMC result...unless the Bernank comes out with something totally outrageous which is probably 50/50 he just might.

Tue, 09/20/2011 - 14:33 | 1689606 rocker
rocker's picture

Reading the article, by unhedged positions and the force out of shorts it may seem that this is what they wanted all along.

Take it down hard, and afterall, they know when to push the manipulated market in either direction.

I love what one trader said on the floor. Traders buy all pull backs knowing the FED has their back. Say POMO.

And another trader said, "we should ask are we going into a recession or depression."

Coin Flip time. Heads they win, Tails they win. Either way, in the markets and your going down.

These HFTs and computer software of hedge funds can see a single dollar bill hit the market and they go after it.

Tue, 09/20/2011 - 14:42 | 1689645 ISEEIT
ISEEIT's picture

Market disappointment isn't likely. I'm thinking Benny will announce three Fed actions. Lower interest paid on reserves. 'twist' long rates, and the bomb will be purchasing European sovereign bonds with a specific mention of Italy.

He'll achieve three much lusted for objectives.

1.) Crush USD

2.) Spike stocks

3.) reduce volatility, at least in the near term.

If I remember right it was Slovakia today that went off line. The EFSF now can't be put in place for at least 4 more months. If EUR can't be stabilized we sure as shit won't be seeing any lessening of uncertainty.

It will all blow up at some point anyway but all they appear to care about anymore is kicking the can.

Tue, 09/20/2011 - 13:40 | 1689429 Robslob
Robslob's picture

This is BULLISH!

Tue, 09/20/2011 - 13:41 | 1689432 espirit
espirit's picture

What's this market going to fall on?  Good news?

This ponzi has decoupled from the rest of the world, and follows the HFT lead.

Tue, 09/20/2011 - 13:47 | 1689456 King_of_simpletons
King_of_simpletons's picture


QE soon. The wall street beast doesn't have human blood to drink anymore.

Tue, 09/20/2011 - 13:49 | 1689465 jblack010
jblack010's picture

One of the more useful posts in a long time.

Tue, 09/20/2011 - 14:06 | 1689519 candyman
candyman's picture

excellent piece

Tue, 09/20/2011 - 14:22 | 1689572 spiral galaxy
spiral galaxy's picture

I'm going with my ZH contrarian play.  Bad newz...BUY!  Good newz...BUY!!  Bad & Good newz....double down BUY!!!  CNBC sez "BUY"........'SELL"!!!!...and fast!!

Tue, 09/20/2011 - 17:04 | 1690119 twotraps
twotraps's picture

totally agree.  the whole thing is pathetic.  

Tue, 09/20/2011 - 14:32 | 1689600 mirac
mirac's picture

How much information is in a Bloomberg terminal?  It boggles the mind...

Tue, 09/20/2011 - 15:19 | 1689778 scatterbrains
scatterbrains's picture

I don't know but when is the TDurden terminal hitting the market ?

Tue, 09/20/2011 - 14:57 | 1689710 wandstrasse
wandstrasse's picture

The first two charts look a bit like Hermann Nitsch's bloodbath-'Schüttbilder'


Tue, 09/20/2011 - 15:10 | 1689752 caerus
caerus's picture

afternoon selloff...check

Tue, 09/20/2011 - 15:20 | 1689788 scatterbrains
scatterbrains's picture

This selling I think is just the nutSack adding /ES shorts so he can reverse with buys in the middle of the night while volume/liquidity is sleeping.


Tue, 09/20/2011 - 16:10 | 1689968 horseguards
horseguards's picture

Way too complex. Why not simply compare current vs historic implieds across strikes, expiries, call vs put (smirks and smiles, and all that)?

Or just look at relative premiums: if calls are higher, sentiment is bullish; if puts are higher, sentiment is bearish. This is basic supply and demand; market-makers will ramp prices in anticipation to compensate for the higher risk (to themselves) and to simply exploit/cash in on the situation.




Tue, 09/20/2011 - 16:22 | 1690012 horseguards
horseguards's picture

Correction: implieds (and premiums, or premia, if your a classical scholar) need to be compared against deltas, not strikes: the delta (and premium) on a 5000 strike when cash is 5,500 will be considerably higher compared to a 5000 strike when cash is 4,500.


Tue, 09/20/2011 - 17:00 | 1690112 twotraps
twotraps's picture

in the article it states that its always been a 'money' problem.  I think its really an image problem, the fed/govt/central bank community has a massive PR problem and needs to maintain the illusion that all this bullshit matters......that debts, ratios, leverage, payments, ALL MATTER.  

They have a dilemma:  How to bailout problem areas to keep the game and their control of it alive....without cheapening the process so much that people catch on.   I am not a fundamental guy, but this shit looks bad and if there is any market left whatsoever, the constant manipulation will come back to haunt you.

Tue, 09/20/2011 - 17:36 | 1690194 msmith
msmith's picture

It's amazing how buyers keep stepping in to buy this market.  The real trouble that Europe is in is no where near priced in the market and the troubles in the US will resurface because nothing has been done to solve them.  Equities will return to the lows this year and most likely head lower http://bit.ly/nlr4c9

Tue, 09/20/2011 - 18:14 | 1690284 prophet
prophet's picture

Who "we" are?

Tue, 09/20/2011 - 19:29 | 1690470 ZeroPower
ZeroPower's picture

Excellent post. Important to note rising volatlity is not always a sign of bearishness either (vol slowly crept higher during 06-07 bull run).

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