The Massive Wall Avenue Companies Use Manipulation Methods To Fatten Their Wallets | Buying and selling Locations with Tom Bowley

I’ve been preaching Wall Avenue manipulation for years. And Wall Avenue took manipulation to a very new stage in 2022, accumulating shares of panicked retail merchants after the distribution interval from January via Might 2022 ended. Positive, we had two extra value lows – one the very subsequent month in June 2022 after which once more in October 2022, however the traits of a backside and accumulation had already begun:

The buildup/distribution line (AD line) was only one secondary indication of the manipulation that passed off in 2022. We noticed the AD line drop all through the primary few months of 2022 and method year-to-date lows in Might, however from that second on, there was intraday shopping for that urged the large Wall Avenue corporations have been gladly shopping for shares from those that believed this was the beginning of a secular, or long-term, bear market. Regardless of the still-downward slope of inventory costs into yr finish and the beginning of 2023, the AD line has been sloping larger.

Manipulation At Its 2022 Core

I tracked the intraday value motion for the SPY, QQQ, and several other ETFs and particular person shares. There may be not a single doubt in my thoughts that Wall Avenue used the entire negativity that THEY CREATED to learn them as they have been in a position to exit the market on the 2021 excessive and bounce again in at a lot decrease costs all through 2022. Now we’re seeing this manipulation come to its conclusion with the large run up in inventory market costs in 2023.

Let me break down for you the worth motion within the QQQ in three distinct phases in 2022 and early 2023. The three intervals are as follows:

  1. January 3, 2022-Might 20, 2022
  2. Might 23, 2022-October 13, 2022
  3. October 13, 2022-February 10, 2023

Inside every of those intervals, I am going to present you the way the QQQ traded at:

  1. The opening hole (panic response to information)
  2. From 9:30am to 11:00am ET (beginner hour)
  3. From 11:00am to 4:00pm ET (skilled time)

Section 1: 2022 Distribution

Here is the breakdown of how the QQQ traded throughout that January third via Might twentieth interval all through the day:

  • QQQ began interval at 400.41
  • Opening gaps (web): -29.68
  • 9:30 to 11:00am ET (beginner hour): -68.01
  • 11:00am to 4:00pm ET (skilled time): -14.59
  • QQQ ends interval at 288.13

There was promoting throughout each timeframe because the distribution and cyclical bear market was fairly evident.

Section 2: Then Comes The Market Disguise

Here is the breakdown of how the QQQ traded throughout the Might twenty third via October thirteenth interval all through the day:

  • QQQ began interval at 288.13
  • Opening gaps (web): -52.39
  • 9:30 to 11:00am ET (beginner hour): -10.54
  • 11:00am to 4:00pm ET (skilled time): +37.46
  • QQQ ends interval at 262.66

Okay, that is the place the charts do not inform us every thing taking place beneath the floor. The QQQ fell one other 25+ factors throughout this era, however take a look at the ultimate FIVE hours of the buying and selling day. It netted a GAIN of 37.46 all through this era. This end-of-day energy is what strengthens the AD line that I confirmed earlier. Wall Avenue corporations have been steadily BUYING and ACCUMULATING, whereas costs continued to say no. I am positive they’d wish to thank everybody personally for his or her beneficiant present of their shares. It is Wall Avenue’s very personal model of “Go Fund Me”.

Section 3: It is Hammer Time!

The underside is in, of us. October 2022 grew to become the Seventh October to put declare to a bear market backside within the final 14 bear markets – stretching again to 1950 on the S&P 500. Anybody assume that is odd? There have been 14 bear markets up to now 73 years and half of them have resulted in October. Aren’t there 12 calendar months? But one has accounted for half the bear market bottoms? What a coinkydink!

Okay, so now let’s take a look at how the QQQ has traded because the October thirteenth low shut:

  • QQQ began interval at 262.66
  • Opening gaps (web): +1.81
  • 9:30 to 11:00am ET (beginner hour): +1.16
  • 11:00am to 4:00pm ET (skilled time): +34.07
  • QQQ ends interval at 299.70

Wait a second! The place did all these morning gaps go? And the morning promoting – what occurred to that? Wall Avenue corporations had already crammed their stockings for the vacations. No extra manipulation required. Now we’ll all watch because the information improves all through 2023. The Federal Reserve has already began it. They’ve introduced we’re in a interval of disinflation now.

“Yeah Tom, however what in regards to the deep recession forward?”

LOL. Did you see the roles report final week? Unemployment is at a document low! Jim Cramer, a former Goldman Sachs little one himself, now says the Fed can obtain a delicate touchdown. In one other six months, all of the unhealthy information and retreating inventory costs can be in our rear view mirror. And Wall Avenue corporations can be fats and completely satisfied.

This text is why was fashioned. To analysis, analyze, and inform of all of the Wall Avenue deception. Sure, technical evaluation and analyzing value motion is extraordinarily necessary, but it surely’s solely part of the battle. Uncovering the “legalized thievery”, as I wish to name it, and educating these easy methods to counter it, is a BIG a part of profitable buying and selling. I spend numerous hours doing this analysis for the good thing about our members. I issued warnings to our members and StockCharts neighborhood at giant on the market high. I additionally stated that being in money or quick in June 2022 carried approach an excessive amount of danger, so I known as a backside there. I imagine it was the appropriate name and all of it stemmed from this Wall Avenue deception. There’s a TON of cash at stake in our monetary markets. Ask your self a query. Do you imagine that the massive Wall Avenue corporations have our greatest pursuits in thoughts?

Brief-Time period Manipulation Runs Rampant Too

We have been providing our members a glance into month-to-month choices expiration because the day I returned to EarningsBeats in 2019. Market makers have giant inventories of name and put choices as month-to-month choices expire (third Friday of each month). The premiums they have to pay out are fairly substantial. However this premium solely turns into an issue at that third Friday shut (which is that this Friday, February seventeenth). Do you assume market makers “would possibly” attempt to direct costs in a sure path if it means they may save BILLIONS of {dollars}? In spite of everything, they commit their huge capital within the monetary markets on daily basis.

I am 100% satisfied that market makers direct costs larger or decrease heading into choices expiration Friday to economize. Think about how the S&P 500 has traded throughout varied intervals of the calendar month since 1950:

  • Twenty sixth-Sixth: +21.05%
  • Seventh-Tenth: -4.11%
  • Eleventh-18th: +12.37%
  • Nineteenth-Twenty fifth: -7.62%

From my training CPA days and the audits that I managed, I do know that many firms have 401(ok) retirement plans. Most firms ship their staff’ contributions to sponsors (Vanguard, Constancy, and so on) across the 1st and sixteenth of calendar months. Some firms will ship different days, however the largest inflows will sometimes happen across the 1st and sixteenth. Wall Avenue corporations know this cash is coming in. So, once more, right here comes the “legalized thievery”. Frontrunning is an unlawful type of shopping for simply forward of retail cash. However when Wall Avenue corporations purchase inventory forward of inflows, is not that basically the identical factor? That is why the above annualized returns are sturdy from the Twenty sixth to the Sixth and from the Eleventh to the 18th. Wall Avenue corporations purchase forward of inflows, driving costs larger. After which comes the cash from people and pensions, driving costs larger. Traditionally, the Seventh to the Tenth represents a profit-taking interval. I imagine the Nineteenth to Twenty fifth is a mix of revenue taking AND value manipulation as a result of choices expiring. Month-to-month choices expiration can solely happen from the fifteenth of a calendar month via the twenty first. The third Friday of the month should happen on a type of 7 calendar days. The earliest the third Friday could be is the fifteenth of the month and the most recent is the twenty first of the month. There are the explanation why we’d see options-related promoting into the week after Friday choices expiration, however I will not get into that right here.

It is also very fascinating that the worst-performing consecutive calendar days on the S&P 500 are the Nineteenth and twentieth. Usually, the inventory market rises into the center a part of the calendar month, leading to an imbalance of in-the-money calls vs. in-the-money places. That helps to elucidate why we see weak point from the Nineteenth to the Twenty fifth. It is one other instance of market makers operating a “Go Fund Me” marketing campaign. Unsuspecting retail merchants pay the worth, sadly.

We make sure that our members are no less than conscious of shares that might be topic to short-term market maker manipulation as a result of choices expiring. I imagine we’ve got directional clues short-term that may considerably enhance our buying and selling success and efficiency. Starting this weekend, we’ve got launched a particularly inexpensive “Max Ache” service designed to supply our members clues about value path this week. I hope you make the most of it.

Glad buying and selling!


Tom Bowley

Concerning the creator:
Tom Bowley is the Chief Market Strategist of, an organization offering a analysis and academic platform for each funding professionals and particular person traders. Tom writes a complete Each day Market Report (DMR), offering steerage to members on daily basis that the inventory market is open. Tom has contributed technical experience right here at since 2006 and has a basic background in public accounting as properly, mixing a singular talent set to method the U.S. inventory market.

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