Last night, after the news that the latest Japanese recession – its fifth in the past 6 years…
… was now in the history books, we had a simple question:
How is the BOJ not buying every USDJPY on this ridiculous news
— zerohedge (@zerohedge) November 16, 2015
And a follow up: how were futures also not soaring on this neo-Keynesian charade? For that, too, we had an explanation – the math PhD’s in charge of the market were unavailable on Sunday night to “calibrate” the algos.
It will take the 21 year old math phd’s at DE Shaw a few hours to reprogram the signals https://t.co/FloZsyUWMD
— zerohedge (@zerohedge) November 16, 2015
Well, it appears they finally got called into office, and just as Europe opened for trading, the USD/JPY experienced an unprecedented 60 pip move on the usual complete lack of any news, just more BOJ intervention and HFT momentum ignition, which in turn was quickly “goalseeked” by the media as the result of more hopes for imminent Japanese easing.
And after being MIA for a few hours early in the session, the HFT programmers finally woke up, and the E-Mini, after its initial brief dip below 2000, is now about 25 points higher on the usual catalyst: newsless, low volume levitation, central bank buying and HFTs momentum.
We expect the BOJ’s infamous favorite level of USD/JPY 123 to be tagged shortly, at which point further gains may be problematic as not even algos can justify dramatic multiple expansion when the world economy is sliding into, if not already in, recession.
Leave A Comment