Published by WallStreetWeather.net
“Unusually high volume… disrupting normal activity…causing a halt in trading…weird… a rogue algorithm…something went haywire…volatility…extreme and wild price swings in both directions…technical problems…delay in processing…reroute orders elsewhere…renewed attention to the fragility and instability of the nation’s stock markets…”
This is a collage of descriptions extracted from reports by The New York Times, Reuters, and The Wall Street Journal to describe what happened August 1 between 9:30 and 10:15 AM when 148 stocks including American Express, Bank of America, DuPont, General Electric, and Molycorp began trading erratically on unusually high volume triggered by a malfunctioning trading algorithm at Knight Capital Group (KCG). All of the above descriptions accurately describe the energies of the Aquarius Full Moon opposing Mercury retrograde in Leo. Knight said it was experiencing “a technology issue,” and told clients to reroute their trading orders elsewhere. Late Wednesday, NYSE Euronext announced it was cancelling the trades of six stocks during that time period where the trades exceeded 30% above or below the stock’s opening price.
Knight’s “technology issue” has cost the market maker $440 million to sell all the shares it had erroneously accumulated. Its stock price has plunged 75% in two days, as Knight is under pressure to find a suitor to save itself from going under. How did the number one market maker in 2011 of retail shares traded of NYSE and Nasdaq listed stocks fall so far so fast? If Knight Trading understood and worked in harmony with one of the most basic planetary cycles, it is unlikely the firm would now be under pressure to act fast to either raise capital or find a marriage partner if the company is to survive. (Mars conjoining Saturn in Libra)
Wall Street has become a world of algorithmic and electronic trading. Technology has helped to level the playing field when it comes to the cost and execution of trades which has also benefitted retail investors. But when technology fails, the impact tends to be far more dramatic and far reaching. Computer programs and algorithms are not flawless as they were created by human minds. An algorithm cannot account for all market variations. Remember that during the flash crash, high frequency trading algorithms shut themselves down when market gyrations reached program limits. The situation with Knight however, is showing one of two flaws in their systems. Either they did not have an automated shutdown mechanism or there was not proper human monitoring of the key statistics while the program was operating.
The Sun and Leo rule speculation and confidence – the key ingredients that make a market. Investors also have to have confidence that their orders are being properly executed.
Electronics, computers and technology is ruled by Aquarius and its planetary ruler Uranus which functions as the higher mind of Mercury. The Moon reflects market sentiment; the Full Moon is a time of heightened atmospheric tensions as it illuminates issues and situations requiring our full attention. The Full Moon in Aquarius describes computer programs going crazy As the planetary energy of communication, commerce, and movement, Mercury rules all business transactions. Mercury in Leo describes processing and routing stock trades. Mercury retrograde in Leo (July 14 – August 8) increases the potential for communication glitches and delays that necessitated Knight’s trading orders to be rerouted.
There is an even greater potential for communications snafus and glitches to occur during the Mercury retrograde period when Mercury makes challenging alignments to the luminaries or other planets. When the market opened at 9:30 Wednesday, the Full Moon in Aquarius opposed Mercury retrograde which conjoined the Sun in Leo which resulted in a sharp spike in volatility and abnormal trading in certain individual stocks. These planetary energies aptly describe the most dramatic and apropos stock affected by the programmed trading glitch. Wizzard Software which makes speech recognition software, dramatically spiked up early yesterday to $14.76 after closing at $3.50 on July 31.
In the chart set for New York City August 1 at 9:30 AM EDT, the Aquarius Moon is in the sector of the chart ruling the stock market opposing the Sun and Mercury in Leo in the sector that is the natural domain of Aquarius/Uranus. Exacerbating the problem is that Mercury is the planetary ruler of the chart’s Virgo Ascendant, and Mercury is also involved in a stressful alignment to Neptune in Pisces.(1) This indicated faulty code caused by a “large bug” which was how Knight CEO Thomas Joyce described it on Bloomberg TV this morning, causing the program to send a flood of errant orders. The Mercury/Neptune alignment and Neptune in the sector naturally ruled by Virgo/Mercury describes the confusion it created in the market and the delay by Knight to resolve the problem. Mercury/Neptune can describe problems that are difficult to solve because Neptune’s energy is elusive, but CEO Thomas claims the programming bug has been corrected.
Knight’s stock began publicly trading on July 8, 1998 at the time of the Full Moon. Mercury in Leo exactly opposed Uranus in Aquarius. Having the two planetary energies that rule Knight’s business in opposition to one another can indicate unexpected system malfunctions that prevent Knight from properly fulfilling orders.
Mercury stationed retrograde July 14 on Knight’s natal Mercury while the Aquarius Full Moon opposed Mercury and conjoined Knight’s natal Uranus in Aquarius, reinforcing Knight’s natal pattern and overwhelming Knight’s system. These energies describe Knight’s unexpected and dramatic reversal of fortune.
In a press release issued today, Knight said the problem “was related to Knight's installation of trading software.” Neptune/Pisces represent interconnectedness. Knight’s trading glitch occurred on the same day the NYSE Euronext (NYX) rolled out its new Retail Liquidity Program which is supposed to compete with Knight to give the best possible price for retail investors. (Excuse me, but weren’t retail investors already supposed to be getting the best available pricing on their trades!?) Oppositions often manifest as tensions with others. Mercury’s opposition to the Aquarius Full Moon symbolizes the competitive rivalry between the two firms as Knight had tried to convince regulators not to approve the NYSE’s new system.
If Knight and the NYSE Euronext understood and worked with planetary cycles, they would know that there are favorable and unfavorable times to do things. The three weeks three times a year that Mercury is retrograde is NOT the time to implement something new!(2) And you definitely do not want to do anything new that is ruled by Mercury such as installing a new computer program! What you DO want to do during Mercury retrograde is put the “RE” prefix in front of everything you do: review, reconfirm, repair, revise, redo, replace, etc.
Mercury retrograde tends to bring back people and situations from the past that serve as a reminder of what has not been fully resolved. Yet Wall Street has refused to learn to read the planetary symbols on the wall! Knight’s trading glitch is a reminder of past major trading glitches, particularly the May 6, 2010 Flash Crash. Mercury was retrograde then in Venus-ruled Taurus (money). Venus was in Mercury-ruled Gemini then as it is now, signifying the financial toll caused by the two trading glitches. Like now, the Moon was in Aquarius (the day of the Last Quarter Moon) and in opposition to a planet in Leo (Mars, the planet of swift moving action). At the flash crash, the Moon conjoined Neptune in Aquarius creating an air of confusion and the sudden disappearance of buyers.
Mercury was retrograde in the last degree of Neptune-ruled Pisces on March 23, 2012 when BATS Global Markets, the third largest U.S. exchange operator after NYSE Euronext and NASDAQ OMX Group (NDAQ) and one of the largest platforms of high frequency computer driven trading, cancelled its IPO shortly after going public. The problem? A software bug that halted trading in several stocks with ticker symbols that began with the letter A and B. Most notably affected was Apple (AAPL) – and its own stock! (After its IPO priced at $16.00, BAT’s stock was halted and never returned to trading after sharply diving down to 4 cents a share.)
Mercury retrograde conjoined the Sun and Uranus in Aries. Along with the Moon in Aries, the trading glitch resulted in what I’m guessing must have been the first and fastest debut and demise of a publicly traded company. Further exacerbating Mercury retrograde’s snafus and confusion was Aries’ planetary ruler Mars retrograde in Mercury-ruled Virgo opposing Neptune in Pisces.
While Facebook’s (FB) May 18, 2012 IPO did not occur during Mercury retrograde, the Moon along with Mercury, Jupiter and the Sun were in Taurus while Venus was retrograde in Mercury-ruled Gemini.
Now that it is a publicly traded company, the social network has to prove it can successfully monetize people’s communications. These energies reflect how overinflated anticipation for the IPO had become and that the real money to be made had enriched CEO and founder Mark Zuckerberg (a solar Taurus) and Facebook’s early investors before Facebook went public. Just as Mercury retrograde causes disruption, the time of an eclipse interrupts current trends as the normal energies streaming into Earth are temporarily disrupted. Facebook went public two days before the Solar Eclipse in Gemini which squared Neptune in Pisces. Facebook’s debut as a public company was delayed by 30 minutes, as Nasdaq’s system became overwhelmed by a flood of cancellation as well as purchase orders which created multi-hour delays to process, leaving many investors holding far more shares than they wanted.
The irony is that Knight’s CEO Thomas Joyce has been a very vocal critic of the NASDAQ’s handling of Facebook’s IPO glitches which cost Knight $35.4 million.
What all of these incidents have in common is that the challenging alignment between Uranus in Aries and Pluto in Capricorn describes the sudden and fast moving spikes occurring out the blue creating a massive loss.
The implications of Knight’s “computer glitch” might have far deeper consequences than in the Libor scandal. This could cause regulators and politicians to revisit high frequency trading for a second look after the Flash Crash. If high frequency trading is curtailed or restricted, volumes on the major exchanges would fall significantly along with liquidity. This has implications not only for the profitability of the exchanges, but also the ability to seamlessly trade.
(1)The Ascendant is the zodiac sign rising on the eastern horizon at birth.
(2)Mercury retrograde in 2012: March 12 – April 4, July 14 – August 8, November 6-26.
2013: February 23 – March 17, June 26 – July 20, October 21 – November 10.
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