The S&P is currently pricing in a deal taking place, but options traders are hedging crash risk. So, as you can see in the chart, the market is trading in a sideways channel waiting for a catalyst. Today the S&P ($SPX) fell 0.76% to 1435.81, the $VIX spiked 11.5% to 17.36 (testing 200dma), and the 30-year Treasury yield ($TYX) fell 1.06% to 2.98%. $TYX and $SPX are still above their 200 and 50 day moving averages.
In his minute long press conference today, Speaker Boehner said:
“Republicans continue to work toward avoiding the fiscal cliff.
“The president’s offer of $1.3 trillion in revenues and $850 billion in spending reductions fails to meet the test that the president promised the American people – a balanced approach. And I hope the president will get serious soon about providing and working with us on a balanced approach.
“Tomorrow, the House will pass legislation to make permanent tax relief for nearly every American – 99.81 percent of the American people. And then the president will have a decision to make: He can call on Senate Democrats to pass that bill, or he can be responsible for the largest tax increase in American history.
Here is President Obama talking about the fiscal cliff during a Q&A session today (embedded at exact time).
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