Understanding the Close Today
There was some confusion about what caused the rally at the close today. I repost my comments from another thread--the thread author posited that perhaps the "PPT (Plunge Protection Team)" caused the bounce. I argue this is unlikely:
Nah, there was strong buying from the infamous #1 in the S&P futures pit at 2:45ET and then ~3:30ET that set it off. No need to make up conspiracies when the truth can be obtained. #1 was fighting GS and JPM who were selling the close, but the floor traders won the day.
In response to a question about who #1 was, GMX further wrote that...
#1 is no conspiracy. He's a floor trader that does big volume on the S&P futures exchange. He started bidding and the whole crowd of locals followed him. The PPT had nothing to do with this... if the PPT exists at all (which is entirely unproven--there is not one trade receipt that anyone has ever found from "the ppt") it isn't holding up the market at 920. If anything, the gov needs the market to drop to give treasuries a boost. As we saw, bonds rose sharply today as stocks fell. The PPT, if it exists, would be acting contrary to the interests of the gov. Therefore, we can categorically say that the PPT, should it exist, had nothing to do with the buying.
It hasn't been conspiracy the past few weeks either. Usually some big bank, often GS or JPM will start hitting the S&P futures ask for 100s of contracts within a few minutes of the close. All us bears see this and say, aw crap and cover. They buy enough to prop the market over key resistance level. When they want the market to decline, they do the opposite, selling the close to just under support. All this talk of PPT is the talk of people who've never closely watched the interactions of the futures market and the cash market.