The Trade That ‘Spooked’ The Market And The Efforts To Push The Indices Off The Cliff
Snippets: I don’t know if you folks saw this … Behind the massive trade that spooked the market yesterday http://www.cnbc.com/id/101528314 **The following was posted yesterday – in real time in the MTS chatroom as well as here in y’day’s Recap. Following the 5yr auction, highest yield since May 2011 – admittedly a delay of 20 minutes or so – the [NDX] [SPY], [RUT] and [MDY] started falling sharply as the indices went on to print new daily lows – retesting/holding yesterday’s lows. A small stock sampling showed: [BIIB] -1.6%, [FB] -5%, [TSLA] -4%, [GOOG] -1% and don’t forget [TWTR] -5.60%. william_blount (12:30) THEY MUST CONVERT THE YELL (1866) TO SUPPORT. If I have the LEAN WRONG and we do a BACKTHOUGH of WEEKLY PIVOT 1858.6 and 1857 SPOT then the door is cracked open for the DUMP… A Break of support at 1850-52 swings that door wide open. Also, mts2 (13:08) chatter that 3k buyer in the SPM (big S&P in the pit) may have been a hedge for a buyer at the CBOE. someone bought up to 15k deep in the money K 1995p. also, this may be tied to paper that sold 4k futures a couple of weeks ago. It was also pointed out – the ES was being bought in a quiet mrkt until 1860 area cracked – leading to the quick 7-handle drop after the buyer was done. If the theory is correct, the chatter cautions for bounce back to middle of today’s range to gauge what’s next versus straight down. Seven minutes later, an initial low of 1849.50 area held. Note: the ensuing rally held 1856 area before the next leg lower retested the weekly low of 1841.50 going into the close.
They are throwing out all they can to knock the indices over the cliff … Consumer Sentiment in U.S. Declines to a Seven-Week Low: Bloomberg Consumer Comfort Index fell for a second week, to minus 31.5 in the period ended March 23 from minus 29. For the first time since early February, all three components of the gauge, which also includes measures of the buying climate and personal finances, decreased in the same week. http://bloom.bg/NZgnKN ** Pending Sales of Existing Homes in U.S. Decline for Eighth Month. The index of pending home sales decreased 0.8 percent after a 0.2 percent drop the prior month that was previously reported as a gain, figures from the National Association of Realtors showed today in Washington. The median forecast of 39 economists surveyed by Bloomberg called for a 0.2 percent rise. http://bloom.bg/1gFMM5T
Brazil’s stock market remains on fire! [EWZ] up another 4% today and 14% since 3/14. Rotation out of US into EM – Bespoke.
Today started with 260k ESM and 600 SPM traded on Globex, ESM trading range was 1839.25 – 1848.50. Yesterday’s regular trading hours (RTH’s), pit session trading range was 1868.50b – 1841.70 before settling at 1842.60, down 16.7 handles. Jobless claims fell 10k to 311k for week ending March 22, pulling the 4-week MA to 318k, lowest reading since last September. Federal Reserve policy makers are counting on sustained improvement in the job market as they wind down their unprecedented bond-buying program and consider when to raise interest rates. http://bloom.bg/NYRvmt
Today’s RTH’s, the June pit session, opened fractionally higher at 1842.50 – 1843.00, traded 1844.00 before dropping to 1834.00. In the opening minutes the much-watched (08:47) RTH 10 handle rule was in effect as well as the weakness in the high-beta momentum stocks that have come under pressure over the last week or so. A small sampling showed both [KING] and [ZNGA] were -3.5%, both [TSLA] and [FB] were down 2.5%, [GOOG] down 1.5%, [BIIB] 0.5% before the [NDX] ripped 50 handles higher – taking the S&P index up to 1848 … before fading back to trade sideways in the the midrange. Prices to watch … Roger_S (12:11) [SPX] 50-day SMA near 1834 and on the upside 1850. SPX hasn’t put together consecutive red monthly candles since May 2012.
Kathy lunch video http://bit.ly/OYvmpA
The afternoon session traded sideways – just under Tuesday’s weekly low and yesterday low of 1841.50. william_blount (14:19) you get a STRONG EXPANDED DAY DOWN–everybody sees the BREAK side of prices. so, when they go home tonight with 2 days left in Q1 –do the bulls look at it as ’35 held’ or do they look at it as TREEND NOW down LETS PUKE THEM FRIDAY INTO MONDAY TRANSITION. bears kind of in same position BULLS were on several recent highs – GET THE DAMN JOB DONE CONVERT THE SPX 1850 TO RESISTANCE. Or we are going to rip your butts – 1857-60 for starters if they dont get it done fri/mon. year end sttlmt – 1841.1 SPOO, 1848 and in CASH. The MrTopStep imbalance Meter, MiM, showed a modest sell side imbalance, $300M, before climbing to $400M and then $800M going into the cash close. The futures traded 1841.30 on the cash close before settling at 1840.60, down 2 handles on the day.
Eco calendar: http://www.investing.com/economic-calendar/
Yesterday was T+3, which stands for trade date plus 3 days for settlement in the stock market. So, if you wanted to sell out of your stock in the first quarter yesterday was the last day. So, from the looks of it the previous week(s) of profit-taking in the momentum stocks may have hit its peak – depending on how things shape up over the coming days. T+3 is commonly in reference to “window dressing or window smashing” as the calendar nears the three days prior to month, quarter and/or year end. It stands for “trade date +3 days until settlement.” Depending on how the month, quarter or year end is shaping up, many portfolio managers add to winners and sell losers (or vice versa) in this precarious time in the calendar. The “Of Course We Owned That Hot Stock This Quarter” is not that easy a trade!
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