2020-10-29

Market Exit One Day Away

Who knows what direction the market moves today and in the coming days, but the high-yield spread is one more day of selling away from signaling time to exit risk assets. The drop in oil today, if it holds, could be enough to push spreads over the line because there are a lot of shale producers with high-yield bonds.
Certainly it is my bias, but USDJPY looks like a harbinger of doom no matter which way it goes. Down and it's a typical risk-off move in assets. Higher and it looks like a big inverted H&S that would result in a collapsing yen.

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