US Junk Bonds are still Trending Down Means investors are taking Risk Off the Table
Trend Down means a 2-month low in an indicator that measures the in the market and it has stayed in a down trend position since then. The magnitude of the decline isn't that great here, as the trend turned down in September with HYG at a little over 91. It is only down to 87.40 as I type (and HYG has paid monthly dividends of roughly 40cents for 10 months now, so they are really at BREAKEVEN right here).
Still, when risk taking earns you zero profits after 10 months, it certainly means there are no profits to distribute (and spend in the real economy) and boost the mood.
If you aren't looking at HYG then start watching it. You can also watch JNK , another High Yield Corporate Bond .
Strategy: Sell short when > +100 as in the other red boxes above. Cover some of the short position as reaches -100. ]
Tim 2:19PM EST Monday, August 3, 2015