Posted on 02/06/2018 5:28:24 AM PST by EBH
According to Karl Denninger the HFT machines, which represent the vast majority of volume (and a good chunk of that being illegal buy/sell orders with no intention to execute) were turned off, which has left the true valuation hanging in space. A big rebound in volume would indicate they’re back on line.
While chaotic, and possibly the beginning of a sharp correction, I’d see that as a good thing if they’re eliminated from participating, or regulated to participating at executions limited by human reaction time. With them in at light speed someone can scramble the market with a button push, at meat speed the market is far less manipulatable.
damn! need to strengthen my position on that one. up almost $100 since last June.
You have been putting too much “stock” in your suspicions of political developments as recent drivers of the stock market than you have market fundamentals and financial causes for the changes, especially the changes of the last day or too.
By all historical standards the stock markets in the U.S. have been moving into over-valued territory for MORE THAN a year. For many weeks now the best market analysis was nly asking WHEN, not if a sell off would begin. That outlook had zip, zero, zilch to do with political developments.
Two big financial signals - the Fed signalling interest rates WOULD go up more, possibly more than once this year, following soon after with labor-wage reports that average wages mad a good jump up. Both signal not necessarily a bad economy, but higher costs for companies which could mean lower net earnings; which makes any already over valued stocks look even more over valued.
Then you have some big bets against a rise in stock trading volatility, which proved to be bad bets when big moves in stocks increased. That left investment funds that made those bets scrambling after Friday to cover their losses - and some did so by getting cash by selling assets (stocks) more on Monday & Tuesday.
The best stock market for long term investing is a stable market at sustainable market valuations with respect to legitimate earnings expectations. The average P/E ratio will have to come down further before that is reached. If the P/E ratio comes down to earth THEN stock market gains from there will have some holding power.
Investing in the stock market is not for anyone looking too anxiously at what it does in the course of a few days - whether it be up or down. Investing doing that wind up “reading the tea leaves” and usually buy and sell when they should not be.
We took some money out of the market 2 weeks ago...knew a correction was coming, and as new retirees wanted some “cash” set aside for next year or so....this is VERY NORMAL, but the media (Democrats) will make it a problem...
Within 48 hours the market will be back up to normal. This is a bargain hunting opportunity.
Back down to 216.53 USD Price increase 2.83
after the beating yesterday some plus side is welcome.
Sometimes a correction is just a correction. The Johnny-come-lately liberals who sold after the election and came back in last year will be the first to bail and stay out until close to the next correction. A healthy market correction is the way to get rid of those weak hands.
I think the Dow is already up 503 points.
Better question is why the VIX fluctuated 2.5 times the amount it did than for similar drops in the past.
Last night, an entire class of investment instrument was wiped out. You can’t short volatility with an inverted short anymore (limits downside).
Now all there is to short is upside, which means unlimited downside risk.
The safeties are now off the torpedoes. The market traded in a 1000 point range today. Massive volatility.
The PPT was in full effect. (plunge protection team)
If you don’t have the stomach for the market, you shouldn’t be in it.
up 10 right now though still below last weeks high.
NVDA is an important co, fingers in many different pies.
1pm pacific 224.69 USD Price increase 10.99 (5.14%)
On Friday? NVIDIA will announce their earnings. They will be good as usual.
I wish the drop did not happen like it did because it was near $249 last week.
It’s called making money.
24,912.77 +567.02 (2.33%)
Open
204.40
High
225.70
That is a big swing for a day let alone what was suppose to be a bad day. Democrat party are upset it did not go down and down.
On Thursday Nvidia will announce their earnings then SWING & ZOOM!
I wonder if Jhen-sun is an R or a D?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.