[From Zero Hedge] A good take of the late day sell off ... again

greenback

Just like yesterday, shortly before 3 pm the market started selling off, amid substantially higher volume and notably larger block size, indicating that while the melt up during the day was due to the now traditional liquidity-rebate HFT crew (funded ironically in large part by the same Chinese IPOs that pay NYSE bills then promptly spontaneously combust a few months later), the selling was primarily by real money. And while the catalyst for the selloff most certainly was not the FOMC decision, many are wondering just what is it about the close of trading that is forcing a market correction (ignore the Dow: it was materially higher only due to IBM which is majorly skewing the index) at about the time when the ETF rebal trade traditionally pushed stocks higher. According to some, the recent surge in SPY shorts may have something to do with it, due to the distribution of rebalancing estimates ahead of time by brokers. If ETFs are indeed creating a feedback loop that now leads to selling instead of buying, very soon we may see a very unique battle between the two main market momentum vehciles: the HFTs which their upward bias, and ETFs, which may now be a downward pressure vehicle. That particular duel may end up being far more interesting than the endless polemic of whether or not fighting the Fed is worth it. Today, the market closed green by a whisper. Yesterday it was not as successful. Tomorrow may prove to be a very informative tie-breaker.

ppteam

according to ZH, currently SPX should be traded below 100. They are good at it.
They are smart people, no matter what.

greenback

according to ZH, currently SPX should be traded below 100. They are good at it.
They are smart peop ...
ppteam 发表于 2010-12-14 21:21

Do you mean SPY should be traded below $100?

ppteam

回复 3# greenback

I mean ZH guys are extremely bearish.

trade28

thx