Comments on: Anticipating PPT Days

By: Where the New PPT Hides

Where the New PPT Hides — Wed, 02 Sep 2009 04:01:44 +0000

[...] our story Anticipating PPT Days for ideas on what these moves look like and how to trade them. This same move was seen in ABK AIG [...]

By: gamingthemarket

gamingthemarket — Sat, 07 Mar 2009 14:37:16 +0000

We all learn new systems from a similar place, so I hope it's useful. I had very little knowledge about the mechanics of stock manipulation until just a few years ago. In some ways it's us against them, and we are at a disadvantage. If others can benefit from what I learn along the way that's a good karma bonus.

By: Caerus

Caerus — Sat, 07 Mar 2009 07:04:44 +0000

Thanks! I'm new to trading and i didn't know what to look for in order to play the PPT.

By: gamingthemarket

gamingthemarket — Sat, 07 Mar 2009 06:37:16 +0000

By: Caerus

Caerus — Fri, 06 Mar 2009 23:04:44 +0000

Thanks! I'm new to trading and i didn't know what to look for in order to play the PPT.

By: berndt

berndt — Thu, 19 Feb 2009 09:36:34 +0000

Thanks for a great explanation t

By: OSR

OSR — Thu, 19 Feb 2009 00:01:23 +0000

Like I said, I'm not so sure about the standard PPT explanation. Isn't the idea that the Fed's surrogate buys index futures in such quantities that futures prices increase disproportionately to the price of the underlying index? Thus, an arbitrage opportunity is created for traders who short the futures and buy the index. If they were doing this, wouldn't it be easily detected by looking at index futures daily volumes? I haven't checked personally, but I'm sure some blogger would have done it by now. Also, this doesn't explain why the indices have remained rangebound since Thanksgiving. If they could make the market go up at will, why stop when the S&P is at 900?

By: gamingthemarket

gamingthemarket — Wed, 18 Feb 2009 21:29:59 +0000

Thanks for sharing. I want to make it clear we have not had a PPT move this week. Read the article carefully and look at the charts carefully. Yesterday had the potential w/ 10:1 neg. internals, but the move did not come.

How often can the Fed stage a rally? Bernanke has made it clear they will do whatever it takes for whatever the cost, into the trillions. More details will be covered in a future story.

For this reason alone, the PPT Day is a viable strategy with the potential of increasing frequency. As the bear market progresses it's possible there will be fewer and fewer long side participants. So it will take more frequent intervention to stimulate the market–to get capital injection. The bank crisis is a clear example of this happening.

According to the Fed, “Repos can be conducted for terms anywhere from one to 65 business days. They are usually overnight, though rarely longer than 14 days.”

http://www.newyorkfed.org/aboutthefed/fedpoint/...

By: OSR

OSR — Wed, 18 Feb 2009 20:55:24 +0000

If I'd read this blog post 2 years ago, I'd say you were a conspiracy nut. I'm not sold on the PPT explanation, but I've been successfully trading these interventions since December.

I trade index options, so I do things a little differently, but you pretty much hit all the characteristics on the head. It is such a distinct move on a 1-minute ticker, you won't likely forget it. Today was a prime example. Starting at 2PM today, I had an order ready to go long on SPY calls. At 2:55, the rocket started and I filled at market. At 3:04, I sold at market netting 13% for 9 minutes worth of work. In December, there were days that I nearly doubled up.

I've had a couple of false alarms, but the damage was mostly the commission. However, I don't believe this is going to a viable strategy for much longer. I believe the first couple bars are coordinated buying, after which the shorts get scared and start covering their way to a rally. Yesterday and today, the intervention came and the shorts didn't flinch. For my own reasons, I believe there a limits on how much they can buy and how deep their pockets are. Just my opinion, but I'm going to be careful.