JNK trade ideas
Ascending wedge shows a potential bearish setup Should price move below the pivot low of 35.94, without making a new high, this short setup will be valid. Price should retrace at least the entire wedge, but more likely the entire move from 31.
Would be looking to short $BKX and $JNKTechnical move. Issues from Europe could weigh in on the US banking system. If we got to the situation where there were no bids on JNK, we could see a pretty large collapse in that market. The US banking sector tracks JNK tightly as it is more of an institutional grade investment that banks do not mind holding.
My most important chart of allThis is the main chart that I am watching at the moment. It has all the information on it that I need to see the markets direction. The main drivers on this chart are oil and JNK (junk bonds). As you can see stocks SPX have diverged to the upside while USD/JPY has diverged to the downside. I am watching in particular for the JNK support to break down with oil. It could be that JNK and oil bounce short term off this support. I expect that that everything will reconnect with USD/JPY at some point. It will be interesting to see what happens. You can see that everything else diverged from USD/JPY in mid Feb.
High Yield BOND (Junk Bound) May signal upside momentum is overLast time price was over its 100DMA was May last year n probably we may see that happen sometime in May this year but now it looks we will not touch it but head back to Feb low. This is another indication that recent rally in the market was fake and may not last that long
JNK, a series of lower low so farthis Junk bond has made a series of lower low, in the event that price is able to break the blue overhead resistance, 200ema is the next supply region
A MIRACLE!!!: One of them does not behave as should be expected.Correlation is certainly not causation, but it is striking that upward behaviour of SPX, DXY weighted SPY and JNK correlate with CNY depreciation. It is also striking that JNK and DXY weighted SPX correlate with appreciation of CNY. SPX not. Not yet? Waiting on the usual Sunday night PBOC announcement... Short SPX!
Spread HYC SP500 increasingTThough High Yield Credits aren't decreasing, the spread between the 2 is starting to increase. Wait for SP to drop.
Junk bond is smarter than stock market?Does it mean that this Junk Bond is going to pull the stock market down again?
Chasing Yield, where? The rats are leaving in waves off the High yield bonds ship, chasing yield ...another ship to board, which one? The harbor is empty. Cash is king, other currencies devaluing big time, panic mode, and since I believe the Eurozone chiefs won't agree on how to genuinely QE to save their buts, well... The short term safe haven is out of stocks and into cash? But not for long. What really scares me about this issue is... aside from more headlines that are not good that are just waiting in the wings to have their 15 minutes of fame... if you stay close up with your charts, the MACD looks like it has bottomed, oversold, and ready for a bounce. BUT, and its a BIG BUT, if you pan out to 7 years, look again, the indicators have room to run much lower. So, regretably, the big picture may be in play here, and we could be going much, much lower. We are right at key levels of support here, on many levels, and if we break the and close under... a couple years from now when you wikipedia search the word "panic selling", may refer to October of 2014. lets all hope I am very wrong about this chart I posted over a month ago.
