Jump to content
House Price Crash Forum
Sign in to follow this  
The Masked Tulip

Dow Mysterious Buyer Wades In?

Recommended Posts

The DOW started off badly this morning heading down straight away and all day long it has been up and down below the opening... but in the last hour or so it has managed to creep up to around where it opened... seems like the mysterious buyer who is propping up the markets has stepped in.

Can't have two 200 point fall days in a row now can we?

Share this post


Link to post
Share on other sites
Don't be ridiculous! You say the oddest things.

No really, I'm curious.

So how do you think that each momentary price level is set, if not between equally opinionated (I'd say informed, but the world these days... sheesh) buyers and sellers?

The logical challenge being, that if any single entity is paying over the odds, and the goal were to maintain price, that buyer would have to be capable of buying the entire market.

Which obviously can't be true, so I'm just trying to understand this farcical meme...

Share this post


Link to post
Share on other sites
No really, I'm curious.

So how do you think that each momentary price level is set, if not between equally opinionated (I'd say informed, but the world these days... sheesh) buyers and sellers?

The logical challenge being, that if any single entity is paying over the odds, and the goal were to maintain price, that buyer would have to be capable of buying the entire market.

Which obviously can't be true, so I'm just trying to understand this farcical meme...

Are you an ******** control freak or what? Do you rush home from work each night to count your baked bean collection?

Sheesh, lighten up will you - even Bubb would have spotted this one now that he has been forced to watch 3 series of Blackadder. Drop your shoulders, take a deep yogic breath in and then drop your trousers, find a block of ice and slide your bottom on it.

Share this post


Link to post
Share on other sites
Mmm, much as I thought.

As you were then.

Here is a naive thought (please bear with me).

If I offer to buy 1 unit of stock for 20% above typical market price, presumably until another transaction is made that becomes the listed value of the stock?

Hypothetically could you place lots of small bids above current asking price and fool the market that way? I know it should be far too fluid, but I guess you would only have to do it enough to effect sentiment.

I am not suggesting that they do it, but theoretically is this possible?

Edited by libspero

Share this post


Link to post
Share on other sites
Hypothetically could you place lots of small bids above current asking price and fool the market that way? I know it should be far too fluid, but I guess you would only have to do it enough to effect sentiment.

Machines have no feelings.

Today's technology would arb the crap out of you.

Repeatedly.

Until you ran out of money.

Share this post


Link to post
Share on other sites
Here is a naive thought (please bear with me).

If I offer to buy 1 unit of stock for 20% above typical market price, presumably until another transaction is made that becomes the listed value of the stock?

Hypothetically could you place lots of small bids above current asking price and fool the market that way? I know it should be far too fluid, but I guess you would only have to do it enough to effect sentiment.

I am not suggesting that they do it, but theoretically is this possible?

Bids are placed at market - you take the lowest priced offered bit.

Offering and accepting bids outside of the market price is not acceptable by the exchanges and the FSA/SEC will come down on you like a ton of bricks.

One bit of market manipulation that used to be widespread is to buy stocks that you already own just before market close on an important date (such as a key valuation date for accountancy purposes etc). I think that this too has been removed by the watchdogs and the exchanges.

Share this post


Link to post
Share on other sites
"They" just buy futures. Arbitrageurs and momo traders do the rest.

Right, now we're getting a little nearer.

But again, today's technology would spot the irrational futures buying and detect a short-selling opportunity to end all opportunities; and unload the entire market in your lap, within a few milliseconds.

Really, you're going to need more depth than the market itself to pull this off.

Edited by ParticleMan

Share this post


Link to post
Share on other sites
Machines have no feelings.

Today's technology would arb the crap out of you.

Repeatedly.

Until you ran out of money.

Fair enough. not sure what 'arb' is, but I bet it's painful :ph34r:

Share this post


Link to post
Share on other sites
Offering and accepting bids outside of the market price is not acceptable by the exchanges and the FSA/SEC will come down on you like a ton of bricks.

Ah, ok.. so someone already tried it

Share this post


Link to post
Share on other sites
Fair enough. not sure what 'arb' is, but I bet it's painful :ph34r:

As in buy at the correct (market) price and sell at your overbid; over, and over, and over again.

What ah-so said is mostly right, but there are ways and means (there are offmarket bids/ placements - dark/ closed trading networks that trade throughout the day and settle at the end of market session).

Edited by ParticleMan

Share this post


Link to post
Share on other sites
Right, now we're getting a little nearer.

But again, today's technology would spot the irrational futures buying and detect a short-selling opportunity to end all opportunities; and unload the entire market in your lap, within a few milliseconds.

Really, you're going to need more depth than the market itself to pull this off.

It depends "who" you're batting against. I would rather stick needles in my eyes than short when GS and/or MS are making all the noise in the pits.

Bear in mind, as you yourself pointed out, program trading dominates. Programs don't make qualitative decisions, they make quantitative ones and simply trigger and arb.

Once "they" are in motion, the computers follow.

Share this post


Link to post
Share on other sites
Bear in mind, as you yourself pointed out, program trading dominates. Programs don't make qualitative decisions, they make quantitative ones and simply trigger and arb.

But if the market itself is functioning, then it's functioning.

I don't get the a "mysterious buyer" is able to move a market with the Dow's depth meme... at all.

The lance I choose to use on this particular lemma is - when and why do sellers choose to stop selling under the last cleared price?

Share this post


Link to post
Share on other sites

Put it this way - if sell-side were so confident that today would be TEOTWAWKI, the market would've gapped straight down to the point where the breakers hit - their first ASK would've been "game over man, whatever we can get RIGHT NOW"; and the session would've been a total bust and stopped before it started.

So clearly, today, sell-side wasn't that pessimistic; but they were a little pessimistic.

And during the session, sentiment turned (it does that), repeatedly in fact.

No tinfoil hat necessary - market in aggregate changed its mind, sometimes they do that; it's all arseholes and opinion.

If any single entity is coming to market with the sole intent of putting a floor under Dow (or for that matter the far more relevant S&P) they'd need to be able to buy everything, because programmed trades in this day and age would immediately sell it to them...

Edited by ParticleMan

Share this post


Link to post
Share on other sites
The lance I choose to use on this particular lemma is - when and why do sellers choose to stop selling under the last cleared price?

There are 101 reasons why they might, but there is the question of size. These bastards can cone in an take out the whole depth if they want, you think sellers aren't aware of buying pressure?

Buyers get bought up or pull their offers. Simples.

Share this post


Link to post
Share on other sites

Edit:

And during the session, sentiment turned (it does that), repeatedly in fact.

Alphaville had some good examples of sentiment turning on zero news, just herds wandering about

trampling vets.

You can do front-running which was heavily implied to Bernard Madoffs top clients. They thought

he had info on trades from other parts of the group and could make them extra, which may explain

how relaxed they were about the high returns. Yet they themselves were being scammed which

just makes it perfect.

Edited by Tom Peters

Share this post


Link to post
Share on other sites
There are 101 reasons why they might, but there is the question of size. These bastards can cone in an take out the whole depth if they want, you think sellers aren't aware of buying pressure?

The market capitalisation of the Dow was just shy of USD2.5tn at the end of March.

Share this post


Link to post
Share on other sites
The DOW started off badly this morning heading down straight away and all day long it has been up and down below the opening... but in the last hour or so it has managed to creep up to around where it opened... seems like the mysterious buyer who is propping up the markets has stepped in.

Can't have two 200 point fall days in a row now can we?

My money would be on it being either Grumpy Old Man or Vicmac buying in, after finally giving up on trying to hoodwink everyone on their bearishness.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   296 members have voted

    1. 1. Which of the Prime Minister's options would you choose?


      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.