E-Mini S&P 500 Future -1%, ES Technical Analysis and ETF Action (SPY, GLD, UUP, TLT)

Here's an update on UUP, SPY, TLT and GLD and the overnight S&P Future (ESU10). When the FOMC Statement hit, you can see that GLD and SPY rallied while TLT (Long Treasury Bonds ETF) and UUP declined. TLT fell pretty hard from its high. When looking at the full trading day though, TLT, UUP and GLD closed up around 0.25% while SPY closed down 0.55% (2 charts below).

It's 3:38am eastern time and the E-Mini S&P 500 September Future (ESU10) is down 1% at 1,108. ES is hitting ceiling resistance at the January and June highs (potential shoulders) and is sticking to its 200 day moving average (1,105).

The E-mini S&P just cut through a rising wedge, which is bearish technically, but was saved by 200DMA support. So ultimate support is a toss up here, you tell me. Either way, it was probably a good time to own some form of insurance at resistance, just in case ES annihilates the 200D and falls to the 50DMA (1,084) or lower. The volatility index is bouncing around multi-month lows, so premium is cheap in the S&P options. Also, there were big buyers of upside September and October VIX call options recently, probably hedging against heightened volatility.

Oh and if there's a market correction, the US Dollar will probably break out of its wedge to the upside (or vice versa). The largest currency hedge fund manager in the world, John Taylor of FX Concepts, is betting on a breakdown in EUR/USD (higher US Dollar) into year end.

FOMC Reaction to Close - FreeStockCharts.com

Full Day

E-mini S&P 500 September 2010 Future (courtesy of OptionsXpress)


August 9: S&P Technical Barriers (200 Week), S&P -0.40% YTD, 30-Year Treasury +11% (TLT, $USB, SPY, $SPX) 8/9