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Where Are Global Players Going for Safety Now?


After an article about the Swedish krona becoming the new safe haven for global investors, it's time to let the charts confirm or deny that assertion.



Treasury yields are range-bound for now.

Just a quick note on the yields on the 10-year Treasury Note ($TNX.X). Support should come into play at 1.548% and things are shaping up for either a terrible breakdown there or a fairly sharp rise in rates (eclipsing the August – September highs easily). I don't think rates will just remain range-bound down here.

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Emerging market bonds holding above support thus far.

Here's another quicky – this time on emerging markets bonds: iShares JPMorgan USD Emerging Market Bond ETF (NYSEARCA:EMB) is trying to hold up above its moving average line. It violated it (barely) late last week, but it quickly traded back above it and has held thus far.

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Junk bonds are breaking down, though.

The technical pictured for the SPDR Lehman High Yield Bond ETF (JNK) continues to deteriorate. Now, on top of the trend line break that I highlighted last week, we have a failed test of that broken trend line (support turned into resistance). If we see a breakdown below the horizontal line support at $39.85, it will be a confirmation of the bearishness developing for JNK.

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So, if I take the new (albeit relatively untested) indicator of the Swiss franc / Swedish krona comparison along with the renewed weakness in the JNK, I might be inclined to but the bears' costume on for this Halloween season. However, with Helicopter Ben and his merry men from around the world, nothing technical can be viewed as a certainty. It is merely information that can help keep things in context overall. That context, however, is keeping me cautious even as stocks try for more upside.

Twitter: @tttechnalytics

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