Credit Spread HYG to IEF ratio
This ratio has been a reliable indicator of market credit.
Now FED declared to manipulate this as well. No free markets with price discovery left. Only people with insider information can make profit.
With small top HnS formation within the big consolidation just above the support rail was warning that credit in the market going to have problem. AND it did soon following breakout.
Read this:
“But as the above chart indicates, just a promise from the Fed to spend billions removing toxic waste from Wall Street’s mega banks is enough to put a bid back in the junk bond market.”
This Chart Shows How the Fed Manipulated Junk Bonds to Help the Dow