"It's Not A Market, It's A High Frequency Trading 'Crop Circle' Crime Scene"

[happy_liberal]

In our original Flash Crash Analysis report, we dedicated a section to an observed phenomena we termed "Quote Stuffing", in which bursts of quotes (at very high rates) with extremely unusual characteristics were observed.

As we continue to monitor the markets for evidence of Quote Stuffing and Strange Sequences (Crop Circles), we find that there are dozens if not hundreds of examples to choose from on any given day. As such, this page will be updated often with charts demonstrating this activity.

The common theme with the charts shown on this page is they are obviously all generated in code and are algorithmic. Some demonstrate bizarre price or size cycling, some demonstrate large burst of quotes in extremely short time frames and some will demonstrate both. In most cases these sequences are from a single exchange with no other exchange quoting in the same time frame...

Recently we posted a required reading analysis by Nanex in which the market trading analytics firm presented irrefutable evidence of quote stuffing by HFT algorithms in tens of stocks, in which thousands of cancelled quotes would reappear each second with a definitive periodicity and regularity, around the time of the May 6 flash crash. Aside from the fact that it is illegal to indicate a quote without a trade intent, this form of quote stuffing is in fact manipulative when conducted by HFT repeaters in specific "shapes" as it actually moves the NBBO actively higher or lower, in cases pushing the bid/offer range up to 10% higher without even one trade ever having occurred, simply by masking a big block order which other algos interpret as bid interest and pull all offers progressively or step function higher (or vice versa, although we have rarely if ever seen the walking down of a stock over the past 18 months). It is as if the HFT lobby has been given the green light by the powers that be that it is safe to activate merely the bid-size quote stuffing algorithms, and not worry: the fact that the market is so one sided in its quote stuffing patterns is sufficient reason to worry of a concerted effort to push stocks higher, initiated from the very top, and effected by not only the Primary Dealer community but by the end-market "liquidity providers." Today, courtesy of Nanex we demonstrate that this type of illegal stock manipulation continues rampant to this very day, and the SEC still fails to acknowledge that it is precisely the HFT market participants that persist in destabilizing stock prices

http://www.zerohedge.com/article/its-not-market-its-hft-crop-circle-crime-scene-further-evidence-quote-stuffing-manipulation-


BATS "Batsicles". BATS price cycling through a large price range, each intermittent with a stub quote, drop it down and start over


NASDAQ "Ask Mountain". Symbol IAU. Over 56,000 quotes in 10 seconds, all with same Ask Price and the Ask Size increasing or decreasing by 1 (to almost 40,000!).

[ixion]

1. Rampant crime on a massive scale.. yet who goes to jail?

Pot smokers.

The world is a reall f'd up place, in my opinion.

[RKP5637]

2. Capitalism at its best. Win at any cost, F the others, F the country, F the world. ME ME ME - None

will go to jail, it's the American way anymore, business as usual.

[ixion]

15. Actually, that's a dark form of quasi-capitalism... and at it's worst

I actually think of it as cronyism, because it requires a group of well-connected people to accomplish, and it doesn't produce anything.

[RKP5637]

16. Excellent point!!! Actually IMO true capitalism with effective regulation works.

[RKP5637]

3. Broken link? "Page not found - The requested page could not be found." n/t

[MagickMuffin]

4. Try this one or...........

just swipe the last part of the url to access home page scroll down to bottom.


http://www.zerohedge.com/article/its-not-market-its-hft-crop-circle-crime-scene-further-evidence-quote-stuffing-manipulation-

[happy_liberal]

6. here is the link

http://www.zerohedge.com/article/its-not-market-its-hft-crop-circle-crime-scene-further-evidence-quote-stuffing-manipulation-

but every time I edit it, the dash at the end is removed and then it doesn't work...

try this one
http://tinyurl.com/2g9o6e3

[RKP5637]

7. Thanks, the second one worked OK. n/t

[happy_liberal]

8. Thank you for telling me

:hi:

[Octafish]

5. Fascinating topics -- together and separately.

An example from July 2010, courtesy of CropCircleConnector.com

[happy_liberal]

9. now, THAT is really cool!

n/t

[Octafish]

11. Pi.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x3478797

[sixmile]

10. Coked-out traders run EVERYTHING

with nary a regulator to be found.

[happy_liberal]

12. This finding is so incredibly important

I wish someone would repost this as to get it more attention. Bad headline maybe?

[truedelphi]

13. Much appreciate you posting it though n/t

[Greyhound]

14. People, even here, are not interested in this topic. It is complicated and requires

some knowledge of how things work, and when you begin to understand how the game is set up only for those that own it, it requires that one begin to think of how hopeless the existing structures are. Then you have to think of why our "leaders" are so unwilling to even discuss it and you start to feel very alone. and we're just not comfortable with that. Better to sit back, flip on the God-Box, and imagine it will all be OK in the end.
:kick: & R

[RKP5637]

17. I know exactly how you feel. Many people when you start to discuss this their

eyes glaze over or they're enraged you question such things, and you must be some kind of radical nut-case out to destroy the country god invented/created. This is a brainwashed nation.

[Greyhound]

18. This is at least the second method they use to steal that has been pointed out

and quickly forgotten.

"Our leader" has put the economic future of our nation in the hands of blatant thieves that continue to work for nobody but G-S, and we're all pretending it's just fine.
:kick:

[JHB]

19. Any ideas on what would work?

A quote fee? Small, but it would add up with these sorts of programmed quote-stuffing?

This sort of manipulation should be illegal (perhaps it already is), but there are always more rule-weasels than regulators, and it would help to make their dodges unprofitable.

[Greyhound]

20. Nothing other than laws (as opposed to more malleable regulations)

that clearly define allowed practices and place everything else outside legalities. And as we have seen, that is not going to happen any more than the simple transaction tax that's been proposed so often.

It is complicated and it is technical, two things guaranteed to evoke somnambulance and chastity in Americans. I was a computer science nerd, I know.