Junk Bond ETFs Hit the “Mother of All Resistance Levels”

“High yield bonds (HYG) are bumping up against THE mother of all resistance levels,” John Kolovos, chief technical strategist for Macro Risk Advisors, wrote to clients Wednesday.

“A spectacular run to say the least, but we think one should be fully aware of the massive overhead resistance that lies ahead.”

Investors have been pouring cash into ETFs tracking high-yielding debt this year, with the category taking in more than $5.8 billion — on track for the largest quarter of inflows since 2012. The $9.3 billion SPDR Bloomberg Barclays High Yield Bond ETF has led the charge, with more than $2 billion entering the strategy this year through March 19.

Reference

Bloomberg, Sarah Ponczek & Carolina Wilson, 2019-03-20, “Junk-Bond ETFs Are Facing the ‘Mother of All Resistance Levels’“