Investors Slept While HFT Computers Took Charge

August 21st, 2012
in Gary's blogging

Closing Market Commentary For 08-21-2012

By 1:30 most of the averages were down fractionally with the $RUT up 1.80 and the DOW down 20. By 3:30 the averages had hit bottom and were melting their way back up again, all of this on low volume. Who is kidding who with outrageous HFT manipulation and other low-ball shenanigans going on. The markets should have never gone this high in the first place.

Markets closed down moderately after the 'BTFD dippers' raced in to snatch up bargains. Yes the markets can melt higher in sessions to come as that is what the algo HFT computers do best, but I shake my head in disgust in wonderment where the real market went.

Follow up:

The RRR** continued to be very narrow during this session and any trades could not be safely assured being profitable with this continuing low volume. Swing trading is again at your own risk being the market is at a crossroads of sorts, I would prefer to sit on my hands rather than risk guessing incorrectly.

This double top scenario has to be put to bed before venturing out to play. The one caveat is there is another high for the markets to reach. For the 500 it is at 1547 made on November 1st, 2007 and that would make a triple top in line with the first one made on 09-01-2000. As of this morning the 500 is only 120 points away and not an unrealistic goal to reach considering the 500 eased up 150 points since June this year some 80 days ago. We have to wait and see if the markets continue down from here.

The DOW at 4:00 is at 13203 down 68 or -0.51%.

The 500 is at 1413 down 5 or -0.35%.

The $RUT is at 815.36 down 1.15 or -0.14%.

SPY is at 141.75 down 0.45 or -0.32%.

The trend is neutral and the current bias is bearish.


WTI oil is at 96.49 trading between 95.88 and 97.60 and the bias is negative.

Brent crude is at 114.36 trading between 114.15 and 115.50 and the bias is negative.

Gold Breaks To Three Month Highs

Gold is up today at 1637.06 trading between 1619.70 and 1641.60 with a neutral bias.

Dr. Copper is at 3.44 up from 3.37 earlier.

Earlier the USD tumbled from 82.46 to 81.81 and is currently at 81.94.

The 500 at the close.

The DOW at the close.


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August 2012 FOMC Meeting Minutes Really Little Changed from the Previous Meeting

Econintersect: You get the feeling at times the FOMC meeting is scripted - as the minutes are little changed from the previous meeting minutes.  The 01 August 2012 meeting statement presented the actions taken, including the usual whiff of quantitative easing (QE), but these meeting minutes released today provides the detailed discussion.

It appears that the FOMC members believe the economy is expanding moderately, but as stated in the previous meeting minutes, not as fast as previously envisioned. The following sums up the potential for more QE:

** RRR = Risk Reward Ratio

To contact me with suggestions or deserved praise:

Written by Gary

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