The top panel is junk vs. long-term Treasury and the bottom panel is nominal junk. HYG/TLT is poking below the 200 day moving average today with a support line just below. Nominal HYG is just in a little pattern with some potential to roll over, but it’s still in a full uptrend above the rising SMA 50.
Per the May seasonal (courtesy of Sentimentrader) and other factors, we’ve been anticipating a little disturbance in the 2nd half of June. If it were to develop into anything good and bearish for the markets, Thing 1 at the top of the chart above would break down and Thing 2 would drop to and through the SMA 50. So I’m not putting the cart before the horse. But am watching him pull it and watching for signs of labor.
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