Monday, July 21, 2014

Another Large Asset Corporate High Yield Bond Fund (VWEHX) Breaks Support

It appears that VWEHX (Vanguard), another large total asset, corporate high yield bond fund has broken below a key long-term support line (S1) based on the chart below. 

Similar to the previous post here on BHYSX (Blackrock), support line S1 and resistance line R2 form a large, longer-term (multi-year) rising wedge pattern that has broken. AlsoS1 and resistance line R1 form another shorter-term (1-year) rising wedge pattern that has broken.

VWEHX is currently at oversold conditions based on the Relative Strength Index (RSI less than 30) in the upper part of the chart below.

Going forward we will be interested to see where corporate high yield bond funds establish new support.

VWEHX Chart: 5yr | daily | semi-log | unadjusted prices

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 does not hold positions in either of these funds (BHYSX, VWEHX), and has sold positions in several other corporate high yield bond funds on 7/11/2014 and 7/16/2014.

Base Chart Provided Courtesy of  Analysis and Annotation by (All Rights Reserved)

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