SPX 2-Hour Chart Negative Divergence Tight Bands Ready to Squeeze Out a Huge Move

Eureka! After about two weeks waiting for the 2-hour to set up properly with negative divergence it is there with the new all-time high printing at 2027.35 today. So a higher high in price occurs and all the indicators are negatively diverged. This indicates that the price move is exhausted. We talked about the little bit of additional juice remaining in the last chart that was posted (RSI and MACD lines green lines) and price comes up for the higher high in price also filling the 2018 gap and this last bit of oomph is satisfied.

The stochastics are trying to build some additional short term juice (green line) but overall the SPX is ready to pull back for a rest from the huge rally move. Note the standard deviation bands (pink) squeezing in tight for a big move. Over the last week, four major binary market events occur (BOJ QE; US Elections; ECB Today; Jobs Tomorrow) which are sending markets wildly in one direction or the other and the charts have to absorb these shocks.

The tight bands say a huge move is at the doorstep (tight bands only foretell a huge move but not the direction). With the Monthly Jobs Report on tap in the morning, can the chart print a couple more handles and wait for that decision before fully committing to the downside? Tomorrow is another binary news event so even though the SPX is topping out that does not mean an upside orgy will not occur if a blowout jobs number is printed.

Sticking to the here and now the negative divergence says down is the direction forward. The tight bands say the down should be strong and swift. The only thing that can save the day is the jobs number in the morning.

Use the VIX 14.10 bull-bear line in the sand as a guide (identified by both the 200-day MA and the Keybot the Quant algorithm) as explained in the previous chart. The market bears remain in the game with VIX above 14.10 and if the VIX moves to 15 and higher the tight bands above will resolve with price collapsing lower. All bear hopes will be crushed if VIX drops under 14.10 since bulls will launch equities far higher out of the tight bands. The VIX is squeezed by extremely tight standard deviation bands on the 2-hour chart as well. A big decision is imminent either now, today, or at the very latest at the opening bell tomorrow. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added 12:20 PM: VIX 14.33. SPX 2026.49. HOD 2027.35. TRIN 0.98. Watch the SPX high of the day now at the all-time highest print in history. The SPX neggie d spank down should begin at any time.

Note Added 1:09 PM: The SPX prints a new all-time high at 2027.37 squeezing out two more pennies of loftiness. VIX 14.25.

Note Added 6:32 PM on 11/6/14: The SPX prints a new all-time high at 2031.61 and new all-time closing high at 2031.21. VIX drops to 13.67. The VIX lost the important 14.10 level at about 3:30 PM and stocks catapulted higher from there. Bears need to push VIX above 14.10 tomorrow or they will have to experience more pain with stocks moving higher. The bulls are on easy street as long as the VIX stays under 14.10. The bulls were given the benefit of the doubt ahead of the important jobs report tomorrow morning. For the 2-hour chart, it remains negatively diverged as the red lines indicate, however, the VST strength with the stochastics (short green line) is now shown with the money flow and RSI. Therefore, a couple 2-hour candlesticks may be needed to deflate this very short term juice. The Monthly Jobs Report is 8:30 AM EST (1:30 PM GMT London time). The neggie d (red lines) is enough to send price lower now but it obviously depends on the jobs report. The expectation as per the chart above remains that a top is at hand now and a bearish move can begin, but, what will the binary jobs report number dictate? The tight bands squeeze in real tight to spend the overnight. The upper band is 2030.96 and price violated the upper band today closing above at 2031.21 so the middle band at 2018 and lower band at 2005 are in play. The bulls ran the clock out today and want the jobs report to make the binary up or down decision for equities. The SPX is going to explode one way or another due to the tight bands; probably 20 or 30 handles over the next day or three. Thus, either the bears take the SPX down to 2000 or the bulls are going to run to 2050+ so the stakes are high tomorrow morning. Using the chart above the expectation would be for price to peak tomorrow and start a downward move. VIX 14.10 and JJC 37.02 continue to determine market direction currently according to the Keybot the Quant algorithm. Bears need VIX above 14.10 pronto or they will fold like a cheap suit. Bulls need JJC above 37.02 to receive more upside juice (so watch copper trading overnight; if copper is moving higher bears are in trouble). If VIX stays under 14.10 and JJC under 37.02, equities will stagger sideways tomorrow into the weekend.

VIX Volatility Daily Chart 200-Day MA Bull-Bear Line in the Sand

The VIX 200-day MA is an excellent market timing signal that you can monitor continuously. Very simply, if the VIX moves above the 200-day MA then markets are in trouble selling off and dropping in earnest. If the VIX drops under the 200-day MA, the stock market rallies higher. The VIX 200-day MA is at 14.10 and this level will have a huge impact on markets moving forward. VIX is above 14.10 so market bears are favored moving forward despite the elevated stock market.

The interesting thing is that the Keybot the Quant algorithm is now tracking volatility as the number one important driver and determinant of market direction for this point in time and guess what? Yep, the algo also says VIX 14.10 is the line in the sand. It is rare the two numbers match up utilizing the two different approaches. This gives VIX 14.10 enormous street cred.

There are two key events occurring over the next 36 hours. First, the mid-term election results in the States and second the ECB meeting Thursday morning. Both are capable of either catapulting markets wildly higher, or, crushing them lower. Use the VIX 14.10 level as the gauge of whether the stock market move is real or not.

If markets rally strongly say tomorrow if the republicans take the Senate, two outcomes may occur. If VIX drops under 14.10 the move higher in stocks is real and the SPX is heading to 2030. If stocks rally but the VIX stays above 14.10, the market bulls got nothing; markets will reverse and sell off.

The top is in for stocks as long as the VIX stays above 14.10. A new leg higher begins in the stock market if VIX drops under 14.10. This VIX 14.10 level will be in play through the end of the week so write it down and reference it often in the coming day or three. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added 11:34 AM on Thursday, 11/6/14: The VIX remains above 14.10 through the Wednesday session into today. VIX is currently printing 14.23 continuing the drama. The LOD is 14.17. The bulls need VIX under 14.10 to prove that more upside is on the way. Equities are mixed the last several days in choppy trading. VIX must make a decision. Either collapse through 14.10 and 14 and signal an upside rally with SPX above 2030, or, bounce from here and catapult above 15 to send equities lower and begin a pull back move for stocks. TRIN Arms Index is dead flat at 1.00 not choosing bulls or bears today. Perhaps another day of sideways with the Monthly Jobs Report on tap tomorrow morning. There are four significant events over the last week; Japan QE, US elections, the ECB today and Monthly Jobs Report tomorrow. Each day the stock market is faced with a new binary event.

Note Added 11:48 AM on 11/6/14: VIX 14.27. Can the bears hold the line or will they crumble? The VIX is squeezed by extremely tight standard deviation bands on the 2-hour chart. A big decision is imminent either now, today, or at the very latest at the opening bell tomorrow.

Note Added 12:10 PM on 11/6/14: VIX 14.43. The beat goes on.

Note Added 12:23 PM on 11/6/14: VIX 14.33. SPX 2026.49. HOD 2027.35. TRIN 0.98. Watch the SPX all-time high at 2027.35 that printed this morning. The SPX 2-hour chart indicates a move down in price should begin at any time for equities. If VIX moves higher that will confirm any market selling. Lots of drama is ahead through tomorrow's opening bell.

Note Added 1:09 PM on 11/6/14: The SPX prints a new all-time high at 2027.37. VIX 14.25.

Note Added 6:32 PM on 11/6/14: The SPX prints a new all-time high at 2031.61 and new all-time closing high at 2031.21. VIX drops to 13.67. The VIX lost the important 14.10 level at about 3:30 PM and stocks catapulted higher from there. Bears need to push VIX above 14.10 tomorrow or they will have to experience more pain with stocks moving higher. The bulls are on easy street as long as the VIX stays under 14.10. The bulls were given the benefit of the doubt ahead of the important jobs report tomorrow morning.

NYMO NYSE McClellan Oscillator Weekly Chart

The green circles show significant market tops over the last three years where stocks roll over and collapse lower and the red circles show significant market bottoms where stocks launch higher beginning a rally. What do you think will happen? This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

SPX 30-Minute Chart 8/34 MA Cross Potential Island Reversal

The 8 MA drops under the 34 MA on the SPX 30-minute chart signaling bearish markets for the hours ahead. The pink boxes show the dashed hopes of the bears as the stock market rallies higher. The 8 MA dipped down for a potential negative cross late in the day on 10/22/14 but the bulls slapped the bears in the face and sent the SPX higher refusing to allow the negative cross. Then the bears tried to create the negative 8/34 cross on 10/27/14 but the bulls punch the bears in the face again and ask them if they want more? You like it so much you want some more? Well, the bears wanted more pain since they tried to create the negative cross the day before Halloween (10/30/14) but the bulls slapped them around some more. The BOJ joins in beating the bears with a baseball bat after the QE money bazooka was fired. The bears did not give up and now have finally created the negative 8/34 cross to receive some market weakness ahead.

The bulls keep beating the bears since rich Uncle Sam the central banker man, keeps handing the bulls money to buy baseball bats. Watch the 8 MA at 2009. The bulls are pushing the SPX higher above the 8 MA so this will curl the 8 MA higher and set up a potential positive 8/34 cross to continue the bull party. The bears need to get price under 2009 as soon as possible and keep it under there and heading lower or they got nothing.

The chart shows a closer-up view of the potential island reversal pattern with the gap at 1999.50-2001.50. Price bounced off the top of the gap a couple hours ago and stays above the top brown line on the island. When price comes back down it will immediately collapse to 1999 and lower creating an island reversal, or, simply leak down into the gap filling the gap not creating an island reversal. The RSI sits at 50% dead neutral between bulls and bears. As RSI goes, so goes price. 

The bears have the edge in this short 30-minute time frame. If the 2-hour chart had such clear neggie d as shown above (red lines) the top would be an easy call on the 2-hour as it is for the chart above. Price may simply stagger sideways until the election results are known this evening and tomorrow. The 8 MA is below the 34 MA so the bears are in charge. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added 1:16 PM: The SPX is 2009.90. The 8 MA on the 30-minute chart is 2008.23. So bears need to move price under 2008 as soon as possible and keep it moving lower if they mean business. If price stays at 2009 and floats higher, the bears are running out of gas and may fold like a cheap suit. If bears move the SPX under 2008 they will likely try for another test of the top of the gap at 2001-2002.

Note Added 1:21 PM: Price is dropping quick with SPX now at 2007.45.... 2007.35..., so the bears are hinting that they mean business. The 8 MA is 2007.97 and SPX price is 2007.79. Use the 2008 level as a guide. Bulls rule the rest of the day above 2008. Bears rule under 2008. As long as the negative 8/34 cross remains, bears rule for the hours ahead.

Note Added 2:01 PM: The SPX is up to 2013 receiving lift in the afternoon.

SPX 2-Hour Chart Rising Wedge Overbot Negative Divergence Potential Island Reversal Gap

Here's the 2-hour chart saga continuing. It has been about 1-1/2 weeks watching this chart waiting for the negative divergence to develop properly and it is like waiting for Godot. The maroon lines show the top at the end of last Thursday's session. Price printed a higher high while all indicators turned neggie d so the spank down was at hand and price started to falter. The only thing that could stop the chart weakness is a positive news event as was ironically mentioned that evening. And, as fate would have it, overnight into Friday morning the BOJ fired the QE money bazooka and boom, an upside launch negating the negative chart set up requiring some time for the chart to build in the euphoria.

On Friday, price gaps up through the 1999.50-2001.50 area (brown lines) and is now sitting on an island above 2001.50. Price now comes down to test this support as this is written and if price would collapse straight down through the gap to 1999 and lower in a heartbeat that is an island reversal pattern. Otherwise, price may continue to simply saunter lower and gently fill the gap as price leaks lower. The third option is a bounce from the top of this gap.

Price ran up through the red rising wedge and failed under the lower red trend line collapsing from the wedge. The saga with the indicators continues. The RSI and MACD remain a hair long and strong so the current down move is questionable. The two peak candles have equal tops but the intra-2-hour top occurs with the MACD a tiny touch higher, thus, neggie d is not 100% there, and you comically need a magnifying glass to split these hairs at this point. The other neggie d (red lines) in the indicators sends price lower today for the initial spankdown but the thought is that price will come back up for another look and perhaps fill that gap at 2018-ish. At that time, price should roll over to the downside and the top will be in. There are two wild cards which bring back memories of last Friday's orgy bounce.

First, the mid-term elections are in play in the States today, the polls are currently open and the politicians are promising a chicken in every pot. The expectation is that the republicans will take the Senate and even though some of this is built into stock prices a rally will likely occur anyway. Conversely, if the republicans are denied the Senate, stocks should sell off strongly. Second, the ECB meeting is Thursday morning East Coast time before the US market opens on Thursday where President Draghi either fires his QE  money bazooka creating a stock market rally, or decides to wait a few weeks. An ECB money bazooka will create another upside orgy in stocks if it occurs. The thinking currently is that Draghi will hold off especially with the smoke from Japan's move still clearing. So there are two events over the next, say 38 hours, that may dramatically affect the charts again.

Marrying the republican Senate outcome overnight tonight with the hint of juice remaining above by the RSI and MACD may bring price up again to that 2018 gap. Equities may want to stagger sideways this afternoon awaiting the election results this evening and through the overnight. The chart is topped out now or about to top out with one more spurt higher. Watch for the gap fill or island reversal at the 1999.50-2001.50 gap. The MACD negative cross occurs (red circle) so the bears are in charge. Thus, the expectation is a continued down move in price now or a brief rally move up tomorrow on the republican outcome followed by continued down directly thereafter. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added 12:29 PM: The SPX bounces directly off the top of the gap at 2001.50 as the above article was written. How do you like that? Price is at 2009.33 running higher. The SPX will likely stagger sideways waiting for the election results. Keybot the Quant remains long and the algorithm is tracking VIX 14.10 and JJC 37.12 as key market direction drivers currently. Copper has collapsed over the last few hours with JJC at 36.45 helping bears. Volatility rises with VIX above 15 helping the bears as well. For equities to move another leg higher, the bulls need either VIX under 14.10 or JJC above 37.12, otherwise, the bulls got nothing. Even if a rally occurs due to a republican taking of the Senate, watch these two parameters since stocks will reverse and roll over to the downside unless the bulls achieve either VIX 14.10 or JJC 37.12.

Note Added 12:49 PM: The bulls are unstoppable with the SPX now up to 2012 taking a big trampoline bounce off the top of that gap at 2001.50 about 1-1/2 hour ago. VIX 15.07 maintaining the 15 level about a buck above its 14.10 rally signal line. JJC 36.40. TRIN is 1.44 favoring the bears today representing a pace of steady-eddy selling even though the Dow Industrials and Dow Transports are a touch positive.

Note Added 2:05 PM: The SPX is up to 2013 receiving lift in the afternoon. Heck, price is so close to the 2018 the bears would be better off simply filling that upside gap to get it over with. VIX is 14.99 dipping under 15 so any move lower in volatility sends stocks higher but price remains above the 14.10 level identified by the Keybot the Quant algorithm. JJC 36.46. The beat goes on.

USDJPY Dollar/Yen Weekly Chart Technical Chart Patterns Negative Divergence Developing

Dollar/yen punches up through 114 at record highs not seen since December 2007. Banzai!! The dollar/yen chart is a technical pattern one-stop shop for any novice chart technician. During 2006-2007, into the October 2007 stock market top, the dollar/yen created a rising wedge pattern, was overbot, and negatively diverged, and received the expected smack down. From 2008 through 2011, the green falling wedge, oversold conditions and positive divergence forecasted the launch off the bottom which occurred.

In play now are the inverted head and shoulders (H&S) patterns. The white inverted H&S off the bottom is head at 75 and neck at 85 so 95 is the target that was attained. The pink inverted H&S with head at 75 and neckline at 95 targets 115. The dollar/yen just poked above 114 a short time ago so 115 may create strong overhead resistance. The brown inverted H&S is head at 75 neck line at one hundo so that targets 125. No doubt that many strategists boasting a 125 target are banking on this pattern.

As price moves higher a red rising wedge may develop. Note that over the last two years the indicators are negatively diverged already hinting that the move is tired. However, BOJ Governor Kuroda fired the QE money bazooka on Friday and there is upside momo so there will be a few weeks needed for the smoke to clear. In the very short term, a pull back of a week or few may be on tap but higher highs would be expected and 115 may serve as an upside target to end the year. At the rate the dollar/yen is rising that may comically occur today. The 118 resistance from 2007 may prove a much more formidable resistance level.

Analysts across the board are short the yen predicting dollar/yen prices of 120, 125, 130 and higher. The boat is fully loaded on the short yen side (higher dollar/yen).  If the 118 gives way the 125 will be on the table but not until then. If 118 occurs, 122 is likely as per Keystone's 80/20 rule where 8's typically lead to 2's. The expectation would be for dollar/yen to top out at 114.5-118.0 in November perhaps early December despite the obscene money-printing by the BOJ. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

XJY Japanese Yen Weekly Chart Descending Triangle Oversold Positive Divergence Developing

BOJ Governor Kuroda ordered more printing presses and is now personally bludgeoning the yen with a baseball bat after announcing the new QE program Friday. Banzai!! The dropping yen moves in concert with the USD dollar basket moving higher now above 87. Global traders are fully on the short yen trade proclaiming a 120 dollar/yen, others say 125, others 130, do I hear 135?; the forecasts grow higher by the minute. The dollar/yen moves above 113 this morning now targeting 114. The boat is fully loaded on the yen short side and in party mode. The BOJ creates the weaker yen to aid its failing economy mired in deflation for twenty years. The lower yen sends the dollar/yen currency pair higher as well as Japan and US stocks. The huge +30% gain in US stocks in 2013 is almost completely attributable to the BOJ printing yen.

The ADX is in strong trend mode at 31 albeit only marginally higher above the mid-20's where a strong trend begins. The yen bulls can turn this down if they act quickly. Note that the ADX trend now, with the stock market at higher highs than 2013, is far below the strong trend in 2013. This hints that those expecting extended yen weakness may be disappointed. The green lines in fact show universal positive divergence over the last couple years despite the collapse in the yen last week due to the BOJ QE money bazooka. In the nearer term, the last couple months, the indicators are positively diverged sans the MACD line that is weak and bleak. Therefore, the yen should stabilize at these levels and will peak a touch lower in the week or few ahead but should base and start the long move higher again. This may cause Japan to commit hari-kari.

The blue descending triangle pattern was mentioned in prior charts but it is surprising that it actually played out. As always looking in retrospect, if it was known that the BOJ would destroy its currency last week the call would have been easy to make to the downside. The vertical side of the triangle is 10 points so the failure at the 97 base targets 87; already there. The 95 S/R level is key. The expectation would be for a bounce from the current price at 87 back up to 89-92 for a week or few, then back down again to 85-88, then up for extended upside for the weeks and months ahead. The 120 and higher targets for dollar/yen may prove elusive and the BOJ and Japan officials may begin to panic as the yen bases and starts to move higher defying the obscene money printing by the BOJ. The BOJ has used up every last piece of ammunition available but will continue to find themselves standing in a burning Alamo in the not-too-distant future. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

USD US Dollar Weekly Chart 4-Year Record Highs Sideways Channels Sideways Symmetrical Triangle Overbot Negative Divergence Developing

The dollar basket continues running higher sending the dollar/yen currency pair higher now at 113.70 running towards 114. The dollar was moving sideways for the last few years squeezing in with the blue sideways symmetrical triangle pattern until a decision had to be made and whammo; a rocket launch occurs from 81. Using the vertical side of 16 handles, the triangle breakout would project 97 in the future. The green circles and lines show that price is at levels not seen since mid-2010 over four years ago. The 2010, late 2008 and early 2009 tops are at 88-89 and serve as upside targets of uber strong resistance. If the dollar moves above 89 the 97 triangle target is firmly on the table.

The ADX show a strong upside trend in place at 37. The ADX is above the prior high during the 2011-2012 dollar rally which is bullish for the greenback. Drilling down more to the near term, price prints a higher high over the last two weeks but the indicators are negatively diverged (red lines) so a spank down and rest from the obscene parabolic spike is needed and on tap. Note the MACD, however, is long and strong. Thus, after a pull back in the dollar, price will resume the upside and print higher highs again as the weeks move forward. Dollar bears must wait until the MACD line turns neggie d before they can cheer for extended downside.

The dollar may move through the 85-89 sideways channel through 2015 and perhaps through the 79-89 sideways channel for the next few years. The 89 resistance is obviously uber important and a game-changer should the dollar explode above this level. ECB President Draghi's jawboning and stimulus sends the euro lower and dollar higher, however, he must fire the shock and awe QE money bazooka at the Thursday meeting or in the direct weeks ahead to create further euro weakness. Otherwise, the euro will move sideways to sideways higher and the dollar sideways to sideways lower.

The neggie will spank the dollar lower for perhaps a week or few but the long and strong MACD line will send price up for higher highs perhaps teasing the 88-89 area especially if Draghi fires the money bazooka in the days and weeks ahead. In general, a move through 85-89 may be on tap for the weeks and months forward which would frustrate dollar bulls now looking for huge upside and at the same time frustrate dollar bears looking for a huge pullback. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Flash Crashes, Software Glitches, "Fat Finger" Trades and Flash Spikes Continue Occurring with Frequency and are Ignored by US Regulators

The flash crashes and flash spikes continue to occur with frequency in the stock market. The same excuses such as "software glitches, technical malfunctions and the proverbial "fat finger" trades are blamed to sweep the incidents under the carpet. Human greed runs rampant as wealthy traders rape the upside in the stock market courtesy of the Fed and other central bankers' easy money. Capitalism and the free market system is completely broken in America. How will it end?

Keystone documents the technical problems occurring at exchanges since the May 6, 2010 Flash Crash event. That way, when the next epic flash crash event occurs, the regulators and officials in charge of exchange and market oversight, as well as the exchanges themselves, will not be permitted a free pass. The power brokers in America are fully aware of what is going on they simply do not care. Instead, the Fed and other central bankers print money to send the stock market higher to enrich themselves and the elite class in America and when the next flash crash occurs they will simply chalk it up to the proverbial "fat finger" trade. The ever-expanding list below is extremely concerning.

5/6/10; Stock Market Flash Crash; the crash begins at 2:42 PM EST with the Dow plummeting about 1000 points (-9%) in minutes but recovering most of the drop by 3:07 PM; $862 billion is lost in minutes; the retail investor is bludgeoned since the stop limits are hit for positions flushing them out at significant losses only to see the stocks to then recover in quick order.

3/23/12; BATS IPO Debacle; results in AAPL circuit-breakers triggering a halt in trading; AAPL resumes trading in quick order but the BATS IPO is cancelled.

5/18/12; FB IPO Disaster; results in a black eye for FB, dubbed FacePlant, and the Nasdaq exchange; traders were not updated on the status of trades resulting in an epic failure.

8/1/12; Knight Capital Trading Glitch; the trading algo’s suffer a technology breakdown spewing out erroneous pricing for about 150 NYSE companies causing a collapse in Knight stock and a loss of 75% of its equity value; the company was sold to Getco forming KCG Holdings.

4/17/13; DAX, CAC, FTSE and Currency Market Mini Flash Crash; Germany leads a mini-flash crash event lower for European markets; the indexes recover in quick order and the collapse is likely due to rumors of credit downgrades pending for European nations.

4/22/13; GOOG Mini Flash Crash; at 9:37 AM EST GOOG price collapses from 796 to 775 (-2.6%) in one second’s time; dark pools are partially to blame.

4/23/13; AP Twitter Whitehouse Hack Attack; a mini flash crash occurs due to a tweet saying an attack has occurred on the Whitehouse; markets quickly recover when the attack is exposed as a hoax.

4/25/13; CBOE Software Glitch; outage occurs prohibiting access to CBOE options on the S&P 500 and VIX; trading resumes in the afternoon resulting in a one-half day outage.

5/1/13; AMT and FMC Mini Flash Crash; price discrepancies cause quick drops and recoveries.

5/17/13; APC Mini Flash Crash; at-the-close orders had to be cancelled.

5/23/13; AEP, NEE and UTIL Utilities Sector Flash Crash; the orders with faulty price levels are not cancelled.

6/6/13; Euronext Exchange Software Glitch; delays the opening of the European indexes for one hour.

7/5/13; NYSE ARCA Computer Glitch; a computer malfunction occurs interrupting the quote system.

8/2/13; CME Treasury Futures Halt; futures stop trading for 5 seconds due to circuit breakers kicking in just before the Jobs Report.

8/6/13; BATS BZX Exchange Glitch; the exchange is not accepting orders due to system issues and Nasdaq routs the orders away from BATS.

8/8/13; USNA Flash Crash; the USNA flash crashes -10% at 1 PM EST and takes down other multi-level marketing stocks HLF and NUS but all quickly recover.

8/16/13; Shanghai Index Market Swing; the Shanghai pops strongly, then drops, intraday, with the biggest market swing in 4 years; Everbright Securities, a State-owned brokerage, is the cause of the error and erratic market behavior due to the proverbial computer glitch once again.

8/20/13; GS Trading Glitch; a GS computer problem occurs at the opening bell involving the routing of options to the exchanges; the problem costs GS about $100 million.

8/22/13; Nasdaq Outage; thousands of stocks stop trading due to a technical problem with Nasdaq securities; the outage begins 12:14 PM EST and ends 3 hours and 11 minutes later at 3:25 PM; about 3200 companies are affected including AAPL, FB, GOOG and MSFT; SEC Chair White calls for a meeting with Wall Street leaders to insure that markets function continuously and orderly; the SIP (Securities Information Processor) feed may have caused the error.

8/25/13; Tel Aviv Flash Crash; a fat finger causes Israel Corporation to plummet 99.9% in five minutes time which sends the TA-25 Index down -2.5% and triggers a shut down; markets recover over the next three hours.

9/4/13; Nasdaq Software Glitch; the Nasdaq experiences another software glitch situation with the SIP feed just like 8/25/13 but the shutdown was only about six minutes; between 11:35 AM and 11:41 AM; NYSE ARCA says the outage was 9 minutes in duration and affected all Tape C (Nasdaq) stocks.

9/13/13; CBOE Options Outage; two CBOE options platforms experience outages but the situation is corrected quickly.

9/16/13; OPRA Outage; U.S. option trading is halted at 1:40 PM EST due to a problem with the Options Price Reporting Agency (OPRA) data feed; a first attempt at restart fails; about 17 minutes later, options begin trading again with minor issues.

10/29/13; Nasdaq Software Glitch; the Nasdaq Composite Index (COMPQ) experiences a glitch at 11:53 AM EST where the index will not update due to a data service feed problem but the individual stocks in the index continue trading; the Nasdaq begins updating again at approximately 12:40 PM; the problem is blamed on human error and involves the Global Index Data Service (GIDS 2.0).

10/30/13; Deutsche Boerse Interruption; data transmission is interrupted at Deutsche Boerse AG (DB1)’s International Securities Exchange.

11/1/13; Nasdaq OMX Group Options Exchange Closure; the options exchange closes at 10:36 AM EST citing technical errors; a significant increase in order entries (probably due to HFT) inhibited the system’s ability to handle the option volume and provide accurate quotes; trading continues on 11 other option trading platforms; the Nasdaq Options Market did not reopen for trading.

11/7/13; OTC Outage; on the day of the TWTR IPO, at 11:25 AM EST, transactions are halted for over-the-counter (OTC) stocks due to a lack of quotation information; the OTC resumes trading 3-1/2 hours later at 3 PM and blames one of its network service providers for the computer glitch.

12/23/13; RUT Small Cap Index; a Flash Spike occurs sending price above 1200, +6%, at the opening bell, then within 15 minutes price collapses -6%. The media does not mention the event.

12/24/13; Copper futures flash spike higher to 3.45, a gain of +4.6% above the opening price at 3.30, due to an ‘error trade’. Price drops about -2.5% and copper closes up +2% on the day. All trades above 3.42 were settled at this level.

12/26/13; AMTD trading pre-market sky-rockets to 130, +330%, from a closing price of 30.44 in the pre-market. The trade is dubbed a ‘fat-finger’ trade and is cancelled.

1/6/14; A bulk selling move occurs in gold futures where gold drops from 1247 to 1232 then back up to 1240 in one minute’s time. GLD, the gold ETF, drops from 120 down to 117, -3%, then back up to over 119 in 60 seconds time. The proverbial ‘fat finger’ excuse is blamed for the event. Later in the day the CME labels the event as a ‘velocity logic event’ and says gold trading was suspended for 10 seconds.

1/7/14; After the opening bell, the NYA leaps +10.4% higher to 11335 a phenomenal 1065 points. Price immediately collapses in a flash crash dropping -9.0% to 10310, plummeting 1025 points. The drama occurs in two minutes time and is an almost 20% overall move for a major index in only 120 seconds. Wow. An equivalent move, had it occurred in the Dow would have been 1700 points up and down, and the SPX would have been 200 points up and down. More interestingly, the event is swept under the rug and no one pays any attention.

1/10/14; At 8:30 AM EST, less than one second before the Monthly Jobs Report number, the buying activity in the 5-Year Treasury note (likely due to HFT) overwhelmed the price causing a stop logic circuit breaker to trip and shut down trading for 5 seconds. The jobs number was released as the markets were frozen in place. Trading resumes and the event is swept under the rug like the others.

1/10/14; At 11:42 AM EST, Nasdaq options trading for symbols A through M fails. The Nasdaq says the OMX experiences an issue processing the OPRA data. After about 18 minutes the options are back on line at 12 noon. This is the seventh incident in the last 13 trading days.

2/4/14; The NYA drops from 9800 to 4, but immediately recovers back to 9800. The quote systems and chart services expunge the erroneous NYA print but no reason is provided for the computer glitch.

4/8/14; At 1:51 PM EST, the CME Globex global electronic trading system experiences a technical glitch and stops trading in several agricultural and grain commodities including hogs, corn and soybeans. Traders experience a mini-panic since about 90% of the commodity trading volume is handled by the electronic system. Contracts impacted are settled in the pits via open out-cry. The CME resolves the computer glitch and plans to be back on line tomorrow ahead of the USDA World Agricultural Supply and Demand Estimates (crop and ag report).

4/28/14; The New Zealand stock exchange is delayed from opening to begin the new week of trading due to a “system issue.” Trading is halted at 10 AM local time and trading resumes fifteen minutes later. The operator of the exchange, NZX Ltd, provides no further comment.

5/13/14; At 3:49 PM, minutes before the closing bell, the exchanges are experiencing wild action in AOL, NDAQ, NBR, LO, MPC, CNQ and other stocks. The flash crashes and flash spikes are suspected to be erroneous trades. Prices return to the same relative levels as before the one-minute flash moves occurred but the AOL trades are cancelled. AOL drops from 37 to under 33 and then recovers; a flash crash of -11% and then +11% recovery in one minute. NDAQ drops from 37 to under 35 and then recovers; a flash crash of -8% and then +8% recovery in one minute. NBR spikes from 25.7 to 28.2 and then drops to the original price; a flash spike of +10% and then -10% drop in one minute. As usual, the exchanges do not know the root cause but HFT is a likely suspect. The NYSE is investigating the flash moves.

5/19/14; At 1:34 PM, the GTX flash crashes from 5039 to 4718, -6.4%, then flash spikes back up to 5039 at 2:06 PM. No reason is provided for the flash crash in the Goldman Sachs Commodities Index and the media outlets and traders ignore the event.

6/2/14; At 10 AM, the ISM Mfg Index is released as 53.2 a miss from last month’s 54.9. The stock market drops. A short time later, errors are found in the release so the ISM release is changed to 56.0 a healthy beat. Stocks place a bottom for the day and recover.  The ISM release is then revised a third time to 55.4 as the actual number. The errors and confusion is blamed on a software glitch that applied the incorrect seasonal data.

6/12/14; Euronext delays the opening of trading on bourses in Amsterdam, Brussels, Lisbon and Paris blaming a software glitch for the disruption.

6/18/14; BAE Systems Applied Intelligence group reports of a serious and sophisticated cyber attack against a major hedge fund in 2013. The event has not been disclosed until now and raises concerns about the safety of large financial firms. The SEC continues to pressure hedge funds and financial institutions to improve cyber security to combat the malicious programs. Another Flash Crash event almost seems inevitable.

7/3/14; India’s BSE experiences an outage for three hours blaming a network problem for the event. Trading resumes and shares move sideways.

8/6/14; At 9:40 AM EST, the 10-year yield collapses. The TNX drops from 2.45% to 2.30% and immediately recovers back to 2.45%; a mini flash crash and recovery. Traders and the media ignore the problem.

8/6/14; At 12:10 PM, the dollar/yen currency pair collapses from 102.30 to 101.90 in a heartbeat then recovers to 102.12 and travels sideways. The usual rumors of a ‘fat finger’ trade are bandied about but no one can identify the exact reason for the mini flash crash; a near -0.5% instantaneous drop. Other dollar currency pairs were affected such as the Aussie dollar. The dollar/yen only precovered a potion of the overall collapse.

8/18/14; A flash crash occurs on the Bulgarian bitcoin exchange platform BTC-e where price drops from 460 to 309 then quickly recovers to 460; a -33% flash crash drop and recovery. The mini flash crashes continue with frequency.

8/24/14; At 8:25 PM EST, the CME halts electronic trading for all markets except Malaysia. Stock futures, Treasuries, oil and gold are all affected. The CME blames technical issues for the outage and trading resumes about four hours later. A cyber attack shuts down Sony Playstation users at the same time sa the CME outage with a hacking group “Lizard Squad” claiming responsibility.

9/16/14; At 8:28 AM, the PPI data is “accidentally” released early. The Department of Labor supposedly has a master switch that permits the news services to report the data simultaneously but obviously the data was leaked ahead of time. Wall Street is an insider’s game.

10/1/14; A major failure occurs at the Tokyo Stock Exchange when stock orders for nearly 70 trillion yen (a huge $640 billion) are placed and cancelled. Orders in over 42 companies are affected according to the Japan Securities Dealers Association. Ridiculously, the error involved nearly 60% of TM shares. As usual, a ‘fat-finger’ is blamed for the erroneous trades but an HFT algorithm may have gone astray. Traders proclaim they have never seen orders this large cancelled. The US stock market sells off strongly hours later with the Dow losing 238 points.

10/17/14; At 11:05 AM EST, all OTC (over-the-counter) trading is halted due to technical issues with the data feeds. NYSE and Nasdaq trading is not affected. OTC trading systems are off line unable to update quotes. FINRA lifts the halt at 12:45 PM EST and normal trading resumes after 1 PM. The obscure ‘technical glitch’ excuse is blamed and the incident is swept under the rug. The flash crashes, flash spikes and software failures occur with frequency across all exchanges.

10/30/14; At 1:07 PM EST, a SIP (Securities Information Processor) failure occurs which is the data feed link between all the exchanges around the world. In one second, 15000 E-mini S&P’s were traded which may have triggered the shutdown. The technical outage creates odd prices for the same stock across different exchanges including the NYSE, Nasdaq and BATS. For example, a stock is priced at 103 on the NYSE but on another exchange is priced at 96. Market participants note the problem and pull orders. Trades that went through at erroneous prices are rectified during the afternoon. Several brokerage firms shut down trading temporarily. ITG, an electronic brokerage, halted trading in its POSIT dark pool for about fifteen minutes. Systems are brought on line and functioning properly at approximately 2:10 PM. The technical glitches continue to occur routinely at exchanges with nothing done to prevent the problems since there is no cross-regulatory oversight. Adding more intrigue, the SPX immediately catapults higher from 1988 at 1:07 PM and peaks exactly at the HOD at 1999.40 when the data feed is back on line at 2:12 PM. The SPX is goosed 11 handles higher with inflection points occurring directly at the start of the outage and at the end of the outage. Why did that happen? Is Wall Street and the stock market rigged? Of course it is. The S&P E-mini trade created vast wealth as the Japan double-whammy shock and awe stimulus was announced only hours later in the overnight session resulting in a huge stock market melt-up on 10/31/14. Wall Street is a corrupt insider’s game and the retail investor is used as cannon fodder. Is another flash crash lurking in the background?

Parabolic Central Bank-Driven Two-Week Stock Market Rally

The power of the central bankers is astounding. The central bankers control the markets. The twelve-day rally is a phenomenal parabolic move higher that began with Fed’s Bullard comments that more QE is on the way. Fed's Rosengren and other dovish members chime in pumping the stock market promising to run the printing presses non-stop. The BOJ continues to goose the markets daily by printing yen which sends the dollar/yen currency pair higher and Japanese and US stocks higher. The PBOC injects billions in liquidity into their troubled banking and economic system adding a further boost. The BOE promises more easy money. The ECB is backed into a corner and plans to weaken the euro to create more upside in equities.

But no, that is not enough by central bank standards. The Japanese government pension fund announces plans to boost purchases of both domestic and foreign stocks on Friday morning (Thursday evening US time). This immediately boosts the NIKK about +2%. But no, the greedy central banks want to make themselves, politicians, the elite class, the wealthy 1% and politicians even more wealthy (since they own stocks) and the BOJ (Bank of Japan) obliges by announcing another stimulus package. It is obscene. The NIKK catapults +5% higher in Friday trading and S&P futures launch higher up +25 in the overnight session. Dow futures are up +200 in overnight trading into Friday morning. Banzai! The double-whammy out of Japan creates an orgy of stock buying.

But no, like the Pink Floyd song that channels Oliver Twist says, "Please, sir, may I have 'more'? And the wealthy, now overtaken with greed, will receive even more either next week when the ECB meets or in the weeks ahead when ECB President Draghi will announce more stimulus. To H*ll with the middle class and poor. As Queen Marie Antoinette is credited for saying in response to the peasants starving, "Let them eat cake."

In about two weeks time, the SPX (S&P 500) moves from 1820 to 2018, a huge 200 handle turnaround, nearly +11%. The power of the central bankers is impressive although perverted and obscene; so filthy and hard-core that even Caligula would blush. Free markets died in late 2008 and early 2009 when the Fed destroyed capitalism by bailing out banks and other companies such as AIG and GM as well as launching quantitative easing.

The Dow moves from 15860 to 17396, 1536 points, nearly +10%, over the last few days. The COMPQ (Nasdaq) is up from 4123 to 4642, a ridiculous 519 points, nearly +13%! The RUT (Russell 2000 Small Caps) moves up from 1040 to 1174, 134 points, +13%! Major indexes simply do not move over +10% in a matter of days unless goosed by the central bankers. If you do not understand this you are not paying attention. The Fed and other central bankers provide the go signal for bullish traders to rape the upside in markets. The central bankers hold the victim, the middle class and poor, to the ground, while the wealthy perform the heinous act all the while professing that they are helping and doing no wrong. The separation of the classes into rich and poor will create social unrest around the world for the months and years ahead. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.