When stocks are showing weakness, we can learn a lot by watching the credit markets.

And in today’s case, Junk Bonds and the ETF $JNK.

Better yet, today we share 2 charts to better illustrate was is happening in the broader markets.

The first chart is the Junk Bonds ETF (JNK) on a “weekly” timeframe. As you can see, $JNK is nearing its COVID lows and has fallen much lower than its June low. This has formed a bearish divergence with stocks, as several indices have yet to puncture the June low… or, if they did, it was very marginal.

The second chart looks at $JNK versus the S&P 500 ETF $SPY. This illustrates just how much further $JNK has fallen when compared to stocks.

In summary, stock bulls do not want to play a game of catch up with junk bonds! Stay tuned!!

This article was first written for See It Markets.com. To see the original post CLICK HERE.


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