Wednesday, March 26, 2014

Emerging Market High Yield Bond Fund (TGEIX) Breaks Above Resistance

[Update (3/28/2014) : TGEIX finished the week above the falling resistance line (red) shown in the 5-year weekly chart in this article.]

Previous posts earlier this month on March 3 and March 17 indicated TCW Emerging Market Income Fund (TGEIX) was turned back at falling resistance. Now, based on the analysis of the 1-year daily chart below, TGEIX appears to have broken above falling resistance (red line - "C") and the 200-day simple moving average (sma, light blue line), after recently testing support (purple line - "B").

(click chart to enlarge)
TGEIX: 1-year | daily | semi-log

Taking a bigger picture view, the 5-year daily chart below shows support lines "A" and "B", shown on both the 1-year and 5-year daily charts, extend back in time to the 2009-2010 time frame. This chart also shows that the 200-day sma (light blue line with brown annotation) has acted as support and resistance at least 6 times in the last 4-5 years.

(click chart to enlarge)
TGEIX: 5-year | daily | semi-log

Below the 5-year weekly chart shows similar patterns as the 1-year and 5-year daily charts above. However, since we don't have this weeks closing price yet, the apparent break above the red falling resistance line on this weekly chart has not yet been confirmed.

(click chart to enlarge)
TGEIX: 5-year | weekly | semi-log

Taking an even bigger picture view, the 10-year monthly chart below shows that in February 2014, TGEIX broke above falling resistance (red line), which extends back to mid-2011.  Resistance was broken after testing a long-term rising support line (dark blue) at the beginning of 2014.

(click chart to enlarge)
TGEIX: 10-year | monthly | semi-log

Not Investment Advice | Important Disclaimer: 
The content in this article, including the identification and discussion of any specific security (e.g., bond fund), is NOT meant to be and should NOT be construed and/or used as investment advice. This article is for general information and educational purposes only. Please read the Disclaimers  for in their entirety. The U.S. Securities and Exchange Commission website has guidance on selecting an investment adviser.

Financial Disclosure:
The author/publisher sold all shares of TGEIX on March 4, 2014, but is considering re-establishing a position in TGEIX at the time this article was written.

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