S&P Under 50DMA, TLT and 30-Year Yield At Make Or Break Point (SPX, SPY, TLT, TYX)

While the S&P camps out below the 50 day moving average and potentially forms a right shoulder (we'll see), the 20+ Treasury bond ETF ($TLT) and 30-Year Treasury Yield ($TYX) are both at inflection points. TLT is just above the 50DMA and close to testing downtrend resistance.  If inflationistas get spooked on the long end and sell because Bernanke is too soft on the short end, TLT could retest the June 2009 lows of $86.

On the other hand RSI is building as is momentum so if there's some type of flight to safety and/or deflation consensus, it could break the downtrend and test the 200DMA at 92.20.  Below I also provided the 30 Year Treasury Yield chart ($TYX).  You can see the obvious make or break level at ceiling resistance and at the triangle point.  $TYX is just above the 50 day moving average so in my opinion if it breaks below that it could test the 200DMA (230 basis points lower around 44 or 4.4%).  Since the October 2009 low $TYX always found support at the 200DMA. 

If the S&P decides to roll over and test the 200 day moving average ($1,037), in the past Treasuries caught a bid so perhaps yields (inverse of price) would follow suit.  I'm not sure if that's the definite dynamic today given jitters on the long end.  Is the long bond now considered "risk" on the "flight to safety" trade even though it's technically "risk free"?  Is "temporary flight" risk officially priced in? I'll just watch the charts, follow the dough...  Charts below are $SPX, TLT and $TYX.

TLT (iShares Barclays 20+ Year Treasury Bond Fund)

$TYX (30-Year T-Bond Yield)

$SPX (S&P 500 Large Cap Index)

[Charts courtesy of StockCharts.com]