Risk Proxy Turns Bullish
It's only Wednesday, but the weekly perspective on this ratio of high yield "junk" bonds to government treasuries is currently painting "Go" conditions. Often used as a proxy for overall market risk, the ratio trends higher when investor demand for high yield bonds is greater than their demand for government treasuries. The concept then is a rising ratio shows risk appetite, and a falling ratio suggests defensive positioning.
Notice that even through the Sept-Oct rally, GoNoGo Trend remained in neutral amber conditions ahead of the "risk off" conditions through Q4 and the start of 2022. As this ratio breaks out into a fresh "Go" trend, we could correlate more bullish conditions to risk assets in the equity and commodity spaces as well.
Looking to the lower panel we can see GoNoGo Oscillator broke through the zero line into positive territory the week of Dec 27, 2021, retested the objective neutral levels of all blended momentum indicators, found support, and has rallied positive again on heavy volume (the line is dark blue on heavy volume, aqua on light volume).
GoNoGo charts paint conditions in real-time, so this final weekly bar is still forming with two days of trading data yet to be factored in, but the weight of the evidence points to the upside.
Better Charts. Better Decisions. GoNoGo Charts.
Notice that even through the Sept-Oct rally, GoNoGo Trend remained in neutral amber conditions ahead of the "risk off" conditions through Q4 and the start of 2022. As this ratio breaks out into a fresh "Go" trend, we could correlate more bullish conditions to risk assets in the equity and commodity spaces as well.
Looking to the lower panel we can see GoNoGo Oscillator broke through the zero line into positive territory the week of Dec 27, 2021, retested the objective neutral levels of all blended momentum indicators, found support, and has rallied positive again on heavy volume (the line is dark blue on heavy volume, aqua on light volume).
GoNoGo charts paint conditions in real-time, so this final weekly bar is still forming with two days of trading data yet to be factored in, but the weight of the evidence points to the upside.
Better Charts. Better Decisions. GoNoGo Charts.
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