HYG NOT looking good

Credit is a great indicator because it's a much larger, better informed market and it tends to lead stocks, "Credit leads, stocks follow".

Several times in the last week and just this Tuesday I stressed the importance of indications in credit for market timing purposes.

This was from a post on credit Tuesday.

"I talked about this asset a lot the last several days because it's one of the most important signals right now, the market is broken, it's like a child's tooth just barely hanging on, HYG is an asset that can basically help us narrow down "When the tooth drops"....

as I said last night, the abandonment of HYG positions, even small ones will be a key timing indicator, even more so in the thinner markets of High Yield credit."

Earlier today in a QQQ/Market Update, even after massive HYG distribution to the point price failed, there seemed to be an intraday arbitrage attempt in HYG to support the market VERY near term and by that I mean most likely a QQQ gap fill attempt, you can click the link at the top of this paragraph to see the charts, very clear.

Those charts for the moment at least, have failed. This is why I've been making a much bigger deal recently about the decision between looking for the optimal entry and being willing to possibly give up some draw-down as to not miss out on the bigger picture.

Here's HYG now, I still need to look at other assets to see if it may come back.

 2 min positive failed, but keep in mind it was very early in the 2 min positive, it was not well established and a very short/less important timeframe so the failure is not surprising, especially when looking at 10 min + charts.

3 min trading in line today.

10 min chart shows major distribution, it will be very hard for short term intraday charts to get a foot hold.