HYG – BUY pattern approaching / here UPDATE 04/10/20

HYG at a crucial level … KEY

04/10/2020 – trust everyone has a blessed and peaceful weekend. also, please keep staying safe. check in if you have the chance …

couple weeks ago, we showed VERY important support on the HYG and detailed how we can find a pattern by simply Projecting, Extending and Retracing. Where the ratio’s all come together then, well, support or resistance SHOULD (operative word) appear. as I have discussed on this blog, a bunch, it’s all PROBABILITY. No idea which will work or which won’t …in this case support held, the BYG liquidation stopped and the market rallied! GREAT … where are we now.

if you want to go down the worm hole which is Elliott Wave then first pay attention to the corrections! Learn em’ and then try to count subwaves for the rest of your life. I have found the EWT to be very helpful in CORRECTIVE PATTERN ID’ing. The most common? A three wave move that is against the overall trend.

we finished a 3 wave SELL PATTERN on Thursday and, if this level holds then expect the stocks to sell off again. note on the chart below … that’s a MONSTER BULLISH gap … pay attention to this ETF!

note the blue arrow projection – it’s equal in BOTH PRICE AND TIME. the market hit the 84.04 level and now, if the pattern works, it should start back down. a gap down below the gap (bearish island reversal) or a big move back thru it is not a good sign.

HYG is getting thumped. as people who are just starting to read my blog or are long time followers you recognize that, for me, it’s all about patterns. period.

don’t try to use any fundamentals (don’t understand them and not smart enough to …) and just try to find patterns. I love patterns … why? because, they give you a really good set of benchmarks or maps of where you are … when they work, you know where you are and, conversely, when they don’t you also know where you are …HYG is so important to the global financial structure.

i’m up early doing some blogging on the west coast and nothing is going on so I’ll say the 66-69 level is a KEY support level / BUY pattern on HYG. It needs to hold at these levels or things are going to get ugly. (like they aren’t already) buy how did we get 66-69?

P – E – R – PROJECT, EXTEND, RETRACE there are other methods to hone in on this level – square of 9, cycles work, etc. But doing a quick PER gives us a nice level and it’s early this AM so I’ll just leave it at her for now …folks, in the world of patterns it doesn’t get much better than this .. we have 6 ratio’s all coming together in the area highlighted below. trust me that equals a big deal. losing this level and something is definitely a foot at the circle K. that sure is a TON of thrust coming into this level … it does warn of a potential failure of this pattern

PROJECT

Orange: .618 ab=cd and Blue: ab=cd

EXTEND: took three key lows (rectangles) and extended fro those points … 2.236 is square root of 5

RETRACE – there she is, the .786 retrace right in/around the key level

Crude Oil Update, ratio of XLE/NYA, HYG and Crude and a bunch of other stuff

11/10/2018 – overall, our key 75-76 level was hit and has caused the sell off. take a look at the charts below …

some critical developments:

  • the XLE/NYSE Index ratio has hit a perfect BUY PATTERN so expecting the energy complex to bounce/hold/consolidate as this level holds.  IF IT FAILS then the sell off will be pretty immense. So watch t his level.
  • on the Crude, anytime you have a .382 and .618 (.382+.618 = 1) present that should act as important S or R. In this case SUPPORT. we have some polarity present also so ‘expect’ a bounce in Crude … will update accordingly.
  • also, note the correlation between crude and HYG. (High Yield Bond ETF) … perhaps the carnage in Crude will stop at support levels indicated which ‘should’ keep HYG at bay (if the correlation is still holding) but if Crude busts thru then that support cliff for HYG should give away and then it will get very interesting
  • also, put the oldie but goodie of the HIGH on crude on my birthday and the subsequent low to show some geometry at work and the fact that long term charts can certainly help .. .a famous quote “there is nothing new under the sun.”

thanks reading …. B

 

 

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06/03/2018 – sorry that i didn’t send out the charts below via my blog .. honestly, I think I just forgot and then went on some travel …big thing here is we hit an important high a week or so ago based on TIME so this could be a very important top in crude.

honestly not sure if we have completed a 4 ( if YES we have  BIG MOVE COMING lower) or an end to a bullish bounce and we are correcting to buy ..

either way, this should do it for crude for a while at least. will be watching and, again, apologize for not blogging earlier.

as an FYI, the charts are real time they were just sent out via email …

let me know if you have any questions.

Bart

this is the update as of 06/001/2018:

EEM and HYG

So, guess, of late, all the rage is the EEM new bull market.

VERY HARD to believe but … let’s remove the subjectivity and pull out some patterns:

EEM:

  • banging right into .618/.786 retracement confluence – usually very strong R or S. in this case R.
  • Note – a basic projection takes us up into the 45-46 area
  • Double trend line resistance

HYG – high yield debt

  • note, it’s been hanging at the .618 for basically 4 months … sure looks like it wants to break out higher.

IF HYG breaks the .618 expect the EEM to target the upper zone of the red box …

IF HYG does not break above the .618 and starts back down THEN perhaps the EEM will start down from current levels.

either way, believe we can goose a little more in the EEM world and the HYG world but .. stiff resistance ahead.

Also, note how correlated HYG (high yield DEBT) is w/ the EMERGING MARKETS (EEM) … hmmmmmmmm

Bart

 

OK, one more on the 10 year …

wanted to show you a “quick look” at the ratio of HYG / IEF.  HYG is an ETF for Corporate Bonds….when we use ratio analysis we look for one security strengthening over another.  In this case, when the ratio goes down the HYG is underperforming the IEF (ten year ETF) and vice versa.

note, the second chart is showing what happens to the 10 year yield when the ratio bottoms … yields go up.

So, if ratio bottomed THEN yields to go higher.

Stay tuned ..

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