ICE BofA US High Yield Index Option-Adjusted Spread forum
BAMLH0A0HYM2 US high yield spreads hit 372 basis points, the highest level since December 2023.Over the last few days, HY spreads have been rising at the fastest pace since the March 2023 Regional Banking Crisis.
Back then, 3 mid-sized US banks failed triggering a broader market sell-off and forcing the Fed to intervene.
A similar spike in yields took place during the 2022 bear market when the S&P 500 lost 25%.
Now, the spreads are back on the rise as the Yen carry trade unwinds.
Bond markets continue to trade like we are in a crisis.
BAMLH0A0HYM2 
SPX 
QQQ 
NDX 
SPYThe the junk bond index is testing its bull flag resistance. A breakout of this index would likely coincide with a crash in equities.
As investors seek a premium for holding risky asset.
BAMLH0A0HYM2 SPY SPXJunk bond are testing a significant resistance in its bull flag pattern whilst posting a bullish cross on the stochastic RSI.
BAML is a index the compares a expected yield of junk bonds over expected grade bonds. In times of risk one would expect a higher yield for holding such risky assets.
