HYG daily charts displays a textbook rising wedge. The red lines show the negative divergence now in place that requires a hard smack down for price. The long term picture is very bearish as HYG tops and rolls over. Note, however, that RSI green line which is the HYG bulls' best friend. That RSI wants to see another matching high for price so any long player that sees a spank down to say, the 20-day MA, should have a second chance to jump ship as price will experience some buoyancy due to the RSI. Do not overlook your good fortune if long and you stick it out in the couple weeks ahead. When price prints a higher high and you see that green RSI line become a red negatively diverged line, pull the rip cord and jump, ohterwise, you will ride her down. Projection is, after a down-up move, sideways to sideways lower prices for the weeks ahead.This information is for educational and entertainment purposes only. Do not trade based on this information. Consult your financial advisor before making any investment decision.
Note Added 3/6/12 at 6:30 AM: Interesting timing to post the LQD, JNK and HYG charts since news hits that companies stampeded into the U.S. corporate bond market with 10 deals floated on Monday. This is going to end very badly.
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