ZB1! trade ideas
Treasury Bond Futures Triggers a Swing Long EntryThis chart of long term treasury bond futures indicates an impulsive move off of the October 2023 low. Since that impulse topped out in a first wave (or an A wave), price has retraced very nicely into the expected depth of correction guideline of the fourth wave of lessor degree. The correction unfolded as a double zigzag that met a the alternate wave guideline of equality as wave W is equal to the length of wave Y in price. With two guidelines met, probability dictates that the correction is complete and odds are that the next advance is underway.
ZB1! - Weekly When Will The Pain Subside?TVC:US10Y and CBOT:ZB1! are strong reverse correlation between each other and with last weeks price action proving to be mainly bearish, I do not believe the pain to the downside has ended...
With TVC:US10Y Thursday's daily bearish hammer forming @ the bullish order block created on Monday, we witnessed a bullish shooting star in CBOT:ZB1! , Thursdays candle which is the complete opposite.
I accept a relief rally up into the Mon 12th Feb 24 daily bearish order block with the market trading higher than 119.24, my idea will be negated.
I do suspect if the TVC:US10Y is to continue to the upside, CBOT:ZB1! will continue its decline with 116.17 in sight.
My philosophy is simple...
Fortify Michael J Huddlestone's concepts that I have studied to consistently predict where the market is more likely to go.
This includes;
- Market Structure
- Buyside/Sellside Liquidity
- Order Blocks
- Liquidity Voids
- Fair Value Gaps
- Optimal Trade Entry
- Premium/Discount Array
- SIBI/BISI
- Many More!
The strategies mentioned here are some of many that I use to implement into my analysis and over time, with consistency I aim to achieve a high degree of accuracy in the markets with the foresight and understanding to assess what went wrong when my bias is negated.
Credits;
- Michael Joe HUDDLESTONE
- Shawn Lee POWELL
- Toray KORTAN
ZB1! - Weekly Continued Selloff? #1Next in line is the T-Bond Futures market with the chances of this asset doing the complete opposite of US10Y 98% of the time.
Observing my bias, the biggest risk I face is the ZB1! repricing sharply next week to capitalise on the buy stops above all the short term and intermediate term highs up to 121.10.
Moreover, the overall sentiment on bonds is bearish than bullish throughout 2024 with more pain being felt if markets were to engineer price down to 119 (1st target) and 116 (2nd target), which will also be in line with bullish interest rates.
My philosophy is simple...
Fortify Michael J Huddlestone's concepts that I have studied to consistently predict where the market is more likely to go.
This includes;
- Market Structure
- Buyside/Sellside Liquidity
- Order Blocks
- Liquidity Voids
- Fair Value Gaps
- Optimal Trade Entry
- Premium/Discount Array
- SIBI/BISI
- Many More!
The strategies mentioned here are some of many that I use to implement into my analysis and over time, with consistency I aim to achieve a high degree of accuracy in the markets with the foresight and understanding to assess what went wrong when my bias is negated.
Credits;
- Michael Joe HUDDLESTONE
- Shawn Lee POWELL
- Toray KORTAN
Forex Factory - Volatility Dreams & NightmaresWe saw 6 high impact news released to the market yesterday and it gave me the volatility needed in order for deep liquidity pools to be tested, namely CME_MINI:ES1! daily bullish orderblock located @ 4976 since I was anticipating shorts yesterday to sellside levels.
Any day that has more than 3 high impact news releases, expect some form of volatility. If not, that day wouldn't be the ideal day to risk capital and would be best to sit on your hands.
My philosophy is simple...
Fortify Michael J Huddlestone's concepts that I have studied to consistently predict where the market is more likely to go.
This includes;
- Market Structure
- Buyside/Sellside Liquidity
- Order Blocks
- Liquidity Voids
- Fair Value Gaps
- Optimal Trade Entry
- Premium/Discount Array
- SIBI/BISI
- Many More!
The strategies mentioned here are some of many that I use to implement into my analysis and over time, with consistency I aim to achieve a high degree of accuracy in the markets with the foresight and understanding to assess what went wrong when my bias is negated.
Credits;
- Michael Joe HUDDLESTONE
- Shawn Lee POWELL
- Toray KORTAN
/ZB (US 30-Year Futures): Holding onto Trend, Targeting 1.618The 30-Year Bond seems to have found support at the 89 EMA aligning with a trend line, it seems that demand for this maturity will pick up soon which would result in the 30-year Yield dropping to around 3.5%. I do however think this drop in yields will be temporary, but the move down in 30 year yields and the move up in the 30-Year Bond Futures will likely be parabolic until the 1.618 resistance is reached.
50/50 Funds Had to Sell Stocks by the End of the MonthMany funds that hold 50 percent stocks and 50 percent bonds have to get their ratios back by the end of the month. With stocks outperforming bonds all month, funds held too much stock relative to bonds. They had to sell stock and buy bonds yesterday.
Can 30 Year Bond Futures Hold Support? 30-year Bond Futures are currently trading in proximity to crucial support levels, with particular
emphasis on the 200-Day EMA, which has consistently served as a support level since the
beginning of the trading year.
Key Developments:
As 2024 commenced, the markets found themselves at a crossroad regarding interest rate
expectations. There were concerns about whether the bond market was preemptively factoring
in 150 basis points worth of cuts in 2024. Before the release of last week's Producer Price Index
(PPI), there was a 60-65% likelihood of an interest rate cut in March, and Fed Funds Futures
were pricing in 125 basis points worth of cuts.
The PPI for December revealed a deflationary trend, indicating a contraction in producer prices.
Initial expectations anticipated a 0.1% increase, but prices contracted by -0.1%. This report
prompted a shift in market expectations for interest rate cuts from 125 basis points to 150 basis
points, resulting in a current 73% probability of an interest rate cut in March.
Technicals:
Significant support levels will persist at the 200-Day EMA and the range of 122’15-122’30.
Additionally, we are observing an intriguing golden cross setup as the 50-day and 200-day
indicators are starting to converge. If the 50-day crosses above the 200-day, it would strengthen
the conviction for a bond rally.
Check out CME Group real-time data plans available on TradingView here: www.tradingview.com
Disclaimers:
CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.
The Bottom in Bonds? The 30-year bond futures market has undergone notable shifts, commencing with a bottoming evident in late October. This trend has been significantly influenced by the unveiling of inflation figures, particularly the Consumer Price Index (CPI) and Producer Price Index (PPI) in November.
Economic Data Driving Bonds:
PPI indicated deflationary pressures, while the CPI surprisingly showed no increase, setting a distinctive tone in the market. The recent revelation in real consumer spending further added to the intricacies, with a downward revision of 3.6%, falling short of the expected 4.0%. Despite a marginal increase in savings rates month over month (3.8% in October compared to 3.7% in September), signs suggest a potential deceleration in consumer activity.
Of paramount significance is the vulnerability observed in the labor market. A deeper downturn in labor market conditions could propel bond prices higher, fueled by heightened expectations for interest rate cuts, particularly for the month of May.
Major Technical and Fundamental Headwinds:
The bond market currently faces a critical obstacle in the form of overhead resistance within the range of 117-22 to 119-05. Market participants are eagerly anticipating a decisive break and close above this level, viewing it as a pivotal indicator that would lend robust support to the anticipation of an upward trajectory in bond prices.
Investors and analysts alike are vigilantly monitoring economic indicators and labor market trends, recognizing their pivotal role in shaping the future direction of 30-year bond futures. The interplay of inflation data, consumer spending patterns, and labor market dynamics sets the stage for a nuanced and closely watched landscape within the bond market.
Check out CME Group real-time data plans available on TradingView here: www.tradingview.com
Disclaimers:
CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
*Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services.
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.
US Treasury Long Bond Futures BottomThere is great potential that the 30 year T-bil futures have bottomed. This chart is a micro count version of the final 5th wave of primary wave 1. Depicted as a legal impulse consisting of an expanded flat correction for minor wave 2. Wave 3 is longer than wave 1, so the length rule is satisfied. Minor wave 4 is labeled as a contracting triangle whose internal C wave is a complex zigzag. The Elliott Wave Theory tells us to expect either a short brief fifth wave following a triangle or an egregiously long extension. In this case, it's the latter, as minor wave 5 subdivides as an impulse containing two extensions in both the minute 3rd wave and the minute 5th wave. Given that the guidelines are satisfied, I have no problem making the call that primary wave 1 of the US Treasury 30 year bond bear market is complete.