Jaws closing

The high yield (junk bond) spread against Treasuries, having earlier moved above the important 4% threshold, continues to advance higher. It has now eclipsed 5%. Accompanying this indicator is the $SPY decline which has caused these "jaws" to move closer to closure. Maintain risk management and stay aware for signs of reversal.

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It's happening....again

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The junk bond spread recently fell below the very important 4% threshold. This is a confirmation of the "risk on" sentiment and the $SPX is enjoying the ride and getting ready to test important levels. A great barometer to keep an eye on.

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The 2023 equity market advance was met with a corresponding decline in HY spreads. These "jaws" again appear to be on the verge of a potential closure.