Don't Ignore This Chart!

Junk Bond ETF Remains with Wedge Support Break

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The High-Yield Bond SPDR (JNK) has a strong positive correlation to the stock market. Notice that the Correlation Coefficient is consistently above the .50 level. This means that the Junk Bond ETF and the S&P 500 move in the same direction most of the time. It could, therefore, be bearish for stocks that JNK broke wedge support with a sharp decline the last six days and remains weak.

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Arthur Hill
About the author: , CMT, is the Chief Technical Strategist at TrendInvestorPro.com. Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed market technician. Arthur has written articles for numerous financial publications including Barrons and Stocks & Commodities Magazine. In addition to his Chartered Market Technician (CMT) designation, he holds an MBA from the Cass Business School at City University in London. Learn More
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