Monday, January 4, 2016

HYG Starts Year Having Trouble With Falling Resistance (daily chart) - UPDATE 1/19/16

UPDATE 1/19/16:

click chart to enlarge

HYG continues to decline in price after testing falling resistance (lower solid red line).  Per historical RSI (upper section of chart), HYG could become much more "oversold" and weak.

UPDATE 1/7/16:

click chart to enlarge

It appears that HYG is falling away from falling resistance formed by the bottom of the expanding wedge (solid red line). HYG has also broken down from a short-term pennant pattern.  This could signal lower prices ahead for HYG given that a pennant is often a continuation pattern - in this case the pennant was preceded by a steep plunge in price.

click chart to enlarge

The first trading day in 2016 has not been a good one for HYG due to resistance posed by the bottom of an expanding wedge (red lines) that HYG broke below in late 2015 after a precipitous drop in price.

Will HYG be able to break back above this resistance line and the lin above it (soild blue)?  

If not and price continues to drop, on this daily chart, the next longer-term support line appears to be just above $76/share (dashed blue).

Please remember that this is not investment advice. You alone are responsible for your investment decisions. See disclaimers below and elsewhere on this website.

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 has no position (long or short) in corporate high yield bond funds at the time this article was written. This position may change depending on future price action.

Base Chart Provided Courtesy of  Analysis and Annotation by JunkBond (all rights reserved)

No comments:

Post a Comment