A strange sea of red inhabits the screens of many traders and investors across the USA this evening, and all it took was for the FOMC to hint that the punchbowl will have to be taken away at some point in the future. Biggest jump in VIX in 2013; biggest plunge in Homebuilders in 8 months (as TOL misses and Starts were ugly); biggest dump in stocks in 2013; Gold plunges to $1565 and suffers Death Cross; USD soars and crosses above its 200DMA; and oil has frantic flash crash early on. Not a pretty day as stocks drop below the lower edge of their up-trend channel for the year and test critical support amid the highest volume of the year. The four words on everyone's lips this evening: Where is Kevin Henry?
S&P 500 futures uptrend is broken...
and remains at a critical support...
as Gold 'death crosses' - with its 50DMA crossing under its 200DMA...
Stocks still have quite a way to go to catch down to credit for the year but our HYG-SPY compression trade is doing well so far...
and VIX seems far less excited - as today saw its biggest snap higher since the 12/28 fiscal cliff concerns...
Homebuilders were monkey-hammered today...to its 50DMA
As the initial selloff in rates post-FOMC hurt Utilities but then the hawkishness sent risk-on sectors reeling...
USD soared as GBP was dumped early on - post FOMC strength was sustained...
Charts: Bloomberg and Capital Context
Bonus Chart: If credit turns out to be even modestly correct - which we have seen again and again - then the following relative sector rich/cheap from Capital Context provide some insight into just how frothy stocks have become (relative to credit). Remember this is not saying that, for instance, the S&P is 2.1% overpriced - it is saying the S&P is 2.1% ahead of credit markets (and as selling progresses so credit will likely feel further pain). The biggest divergence is in homebuilders...
