We’re seeing quite a bit of intra-day monkey business over the past week on the equities side. Specifically I’m referring to gapping action, wild swings during the RTH, all in the context of minimal momentum (at least judging by the hourly Zero signal). Someone mentioned this morning that he has been observing a significant drop in L2 activity (i.e. b/a sizes and durations) over the past year and that does not surprise me as many large funds have been exiting over the past year.
The DEP may want to consider adding a dash of lithium into the N.Y. drinking water as the sentiment swings we’re seeing across equities may be diagnosed as borderline bipolar. One week it’s doom and gloom and the next it’s buy the dip. And then yesterday everyone suddenly lost all interest and just walked away leaving only me and a handful of steel rats propping up the tape.
I’m having way too much fun this morning, which accounts for my somewhat belated post. There literally seem to be juicy setups crawling out of the woodwork and I just kept adding new ones while reducing exposure on others in order to reduce correlation risk. So without further ado let’s jump right in: