Fed Front Running

When it gets too much
I need to feel your touch
I'm gonna run to you
--Bryan Adams

Pretty breakout above resistance from a multi-month inverse head-and-shoulders pattern in the S&P (SPX) today. New recovery highs once again.

Interestingly, this bullish action is occuring one day prior to the bimonthly FOMC policy statement. Seemingly, market participants are front-running the Fed, anticipating that the central bank will continue its money printing ways.

Should tomorrow's FOMC statement indeed be perceived as accomodative, then today's action may mark the beginning of another leg higher.

However, should Uncle Ben & Co surprise the masses with some hawkish FOMC verbage suggesting that the monetary spigots may be turned off, then today's break out might turn into tomorrow's fake out.

position in SPX