iShares iBoxx USD Investment Grade Corporate Bond ETF (LQD) is an exchange-traded fund incorporated in the USA. The ETF seeks to track the investment results of an index composed of U.S. dollar-denominated, investment-grade corporate bonds.
While .gov yields are rising considerably, corporate bonds are not that far behind. The weakness on the longer term is clearly visible on the chart below. After peaking at ~124 since 2011, the market has entered a solid primary down trend which is likely to take prices on a ride towards 110.90, 107.75 and possibly even the 100-zone on a 12+ month horizon.
Our main focus is on the 107.75 area. Here the 162% extension and pivot lows of 2011 converge. The bear market in bonds is highly likely to stay for the foreseeable future.
- Near term trend: negative
- Long term trend: negative
- Outlook: negative
- Strategy: avoid long-bonds (corporate or .gov)
- Support: 110.90 / 107.75 / 99.85*
- Resistance: 118.70 / 124
- Outlook cancelled/neutralized above 118.70
Weekly chart iShares iBoxx USD Investment Grade Corporate Bond ETF (LQD)