U.S. stocks ended the final session before the Fed's decision lower. Today, what matters as much as the rate decision itself is whether Treasury yields fall afterward: if borrowing costs stay high, relief in stocks may be limited.

Crypto support levels are under pressure as investors wait. Bitcoin fell below its previous $76,685 support, while Monday's sharp divergence in technology reversed on Tuesday. So before I read too much into a single positive statement, I am watching which assets attract buying and how long it lasts.

Key takeaways

  • The Fed's rate meeting (FOMC) concludes today. A rate increase is not the same as a message that further increases will follow; the statement, economic projections and press conference should be assessed together.
  • When inflation is driven by oil, a rate increase cannot directly increase supply. Even so, if confidence in the Fed's ability to control inflation weakens, investors may demand higher yields on Treasuries. For stocks, both risks are in play.
  • The SPY ETF ($SPY), which tracks the S&P 500, closed below $760 again. The chip-company ETF SMH ($SMH) rose modestly, but not enough to recover the previous day's loss.

What happened?

  • On Tuesday, SPY fell 0.46% and QQQ ($QQQ), which tracks the Nasdaq 100, fell 0.65%. The software-company ETF IGV fell 1.02% while SMH rose 0.11%. Buying in software after Monday's sharp hardware-stock sell-off did not continue into Tuesday.
  • CNBC's closing bulletin reported that the yield on 10-year U.S. Treasuries topped 5% during the day. Bond prices and yields move in opposite directions; a rising yield makes new borrowing more expensive while also pushing down the price of existing long-term bonds.
  • Market commentator Tunç Şatıroğlu (@tuncsatiroglu) considers the $540 area important for SMH, but does not treat a move there on its own as a reason for new buying. The distinction between waiting for a rebound and seeing buyers actually gain strength matters even more on Fed day.
  • On September 15, the U.S. Senate failed to reach the majority needed in a procedural vote to begin consideration of the CLARITY bill, which aims to regulate the crypto market: 49 votes were in favor and 50 against. This was not a final vote on the legislation; it is now harder to use regulatory expectations as a positive near-term catalyst.
  • Reuters reported that oil loadings at Yanbu Port were halted after an attack on Saudi Arabia's East-West pipeline. Brent slipped to $107.82 this morning, but the shipping disruption persists. It is unclear when the pipeline will return to full capacity; a one-day drop in the price does not mean supply has recovered.

What changed since yesterday?

  • In the previous note, I pointed out that SPY had reclaimed $760 and IGV had reclaimed $106. Both fell back below those thresholds at Tuesday's close. By contrast, SMH held above $540; the outlook is not worsening for all technology stocks in the same way.
  • GLD ($GLD) and SLV ($SLV), which track gold and silver, rose 0.33% and 1.21% respectively on Tuesday. This reaction in metals shows that buyers were present despite the stock sell-off; it is still too early to conclude that a strong multi-day turn has begun.

Market levels

U.S. stocks and Treasuries

  • SPY finished at $757.39. The day's low of $756.15 is a nearby support candidate; without a move back above $760, it is harder to expect an easy advance toward the $770 resistance zone.
  • QQQ closed at $704.54. The $702.74 low from the previous session is nearby support; the recovery must clear $712 first, followed by $720. Staying between these thresholds does not mean a strong rally has begun.
  • SMH's $542.11 close leaves very little room above the $540 support zone. If the rebound strengthens, $557 is the first important resistance; a sustained move below support would weaken expectations for a new recovery.
  • IGV closed at $105.55, losing $106 again. The previous session's low near $104.97 is a support candidate; if $106 is reclaimed, the next resistance is $108. The Monday rise must first reverse this loss to continue.
  • TLT ($TLT), which tracks U.S. Treasuries with maturities of more than 20 years, finished at $80.71. The previous session's low of $80.51 is support, while its high of $80.85 is a resistance candidate. The fund's low price alone is not a reason to expect a turn; pressure may continue if Treasury yields keep rising.

Precious metals and crypto

  • GLD closed at $394.15; the previous session's low of $391.81 is a nearby support candidate. It is difficult to say the rebound is strengthening before the daily resistance candidate at $395.31 is cleared; $401.15 is the next broader recovery boundary.
  • SLV rose to $57.53 and closed above the previous $57.38 threshold. If this area holds as support, the chance of moving toward the broader resistance zone around $58.73 improves; if it is lost again, the previous session's low of $56.95 comes back into focus.
  • Bitcoin was around $75,774 this morning. Trading below the previous $76,685 support weakens the short-term outlook; without reclaiming that boundary, a scenario targeting the $81,853-$83,220 resistance zone remains weak. The earlier bullish condition was a four-hour close above the zone followed by continuation.
  • Ethereum was around $2,402, close to the $2,380 support, with the $2,530-$2,576 zone above. XRP was around $1.304 after losing its previous $1.38 support, with $1.45 as higher resistance. Solana was around $97.20 in the $96-$98 support area; its first rebound boundary is $100-$101, with a stronger confirmation zone at $107.48-$108.

Red flags

  • If stocks rise on the initial news while Treasury yields also rise, financing conditions are not easing. The risk of giving back the initial move grows especially for companies sensitive to expectations for future earnings.
  • In crypto, a brief move through support is not the same as a four-hour close. Failure to reclaim the lost area means positive news has not yet overcome selling pressure.

Calendar

  • Today at 3:30 p.m.: U.S. August retail sales. We will watch how strong consumption and domestic demand remain.
  • Today at 9 p.m.: the Fed's rate decision and economic projections. Times are shown in Türkiye time.
  • Today at 9:30 p.m.: Fed Chair Kevin Warsh's press conference. What matters is which data will guide subsequent decisions.

My analysis

Today, rather than take a position based on a single rate forecast, I am looking at which problem the decision addresses. With the oil supply disruption continuing, monetary policy has limited power to change the situation. But keeping rates steady does not automatically bring cheap financing; if inflation concerns strengthen, borrowing costs set by the market can keep rising.

For more reliable relief, I would want Treasuries to recover after the statement, followed by buying that spreads across a broader group of technology stocks. A rise limited to a few large companies would not change my view. Conversely, if borrowing costs fall and selling is absorbed even after a hawkish decision, I would reassess whether much of the bad news may already be priced in.

Sources

This is not investment advice; it is a research and monitoring note.