A Growing Black Cloud Over The Market | Seeking Alpha

A Growing Black Cloud Over The Market | Seeking Alpha



Eric Parnell has written a great article about how the high yield bond market as represented by HYG is intertwined with the stock market in general.  He mentioned specific oil companies that are involved with HYG, and he talked about how some of these companies have experienced a large downturn.  Moreover, Eric discussed how the stock market could be eventually pulled down by the tanking of the oil sector.



My best performing stock right now is TMF, the 3x long treasury bond ETF.  It goes up when the market goes down because people will rush to safety in government bonds.  I think the downturn is just temporary, though, because the economy is okay currently.  The hard part will be picking an intermediate bottom from which stocks will rebound.  I will be monitoring $NYMO, the NYSE McClellan Oscillator, for a possible bottom around -60 or lower.  At that point, I will sell most of my TMF and go long on stocks like UDOW or MIDU.