February 28th, 2020 - Issue #1001
In This Issue
1. Trading 102: Options on Futures In Depth Information
2. Hot Market Report: US treasury bonds acting as safe haven
3. Economic Calendar
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1. Trading 102: Options on Futures In Depth Information ( Note: When volatility is SO HIGH, options can provide additional ways for possible hedging and alternative speculation - our brokers will be happy to assist)
A comprehensive resource for information on options on futures
In this section you will read and learn about the following:
*Options Basics
*Options Strategies for Bullish set ups
*Options Strategies for Bearish set ups
*Options Strategies for Neutral set ups
*Selling Options Premium - an overview
And much more!
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2. Hot Market Report: US Treasury Bonds acting as main safe haven during this insane volatility.
By Ilan Levy-Mayer, VPClick on image below to enlarge
The US 30 year treasury bond market belongs to the "interest rate family" 10 year, 5 year, 2 year notes, the "Ultra bond" and others. All traded on the CBOT exchange.
US Treasury bonds have been acting as almost the ONLY safe haven out there....gold lost a lot of ground and so did Bitcoin, yet US bonds have been going higher as stock markets around the world have dropped quite a bit....Cash is king?
Daily chart of T-Bond Futures for your review from this morning ( February 28th 2020). Bonds are a very liquid market with a relatively LARGE tick size of $31.25. Bonds also have some of the LOWEST exchange fees in the futures markets which make the total cost of trading it cheaper than the mini SP or crude oil for example. This market offers different type of day-trading vehicle. Different behavior and personality. I like to look for set ups in this market and the 10 year notes in different ways. One is trying to "SCALP" the large tick size and the other, which I prefer is to look for "longer day trades " using the 15, 30 and 60 minutes charts. If you are a day-trader, you may want to watch this market, get a feel for the different type of trading it offers versus Indices or crude oil for example and see if it is a "worthy" market to add to your day-trading markets list. It goes without saying that bonds are an excellent market for options, swing trading and long term trading as well with 23 hours trading, strong volume and excellent liquidity. This chart was prepared using our FREE E-Futures Int'l software, which you can demo for 28 days with real time data.
To access a free trial to the ALGOS shown in the chart ( "early trend identifier" included) along with other tools, visit and sign up for a free trial for 21 days with real time data.
30 yr Treasury Bond Futures Specs
Hours: 05:00 PM previous day to 4:00 PM Central Time
Margins: $3080 initial, $2800 Maint. ( as of the date of this newsletter)
Point Value: full point = $1000 ( Example: 144.16 to 145.16 ). Min fluctuation is 0.01 = $31.25 ( Example: 144.16-144.17) Settlement: Physical Delivery
Months: Quarterly (March,June,Sep,Dec)
Some of the basic fundamentals to keep in mind when you are considering trading the U.S.30yr Treasury Bonds for this matter:
1. Interest Rates.
2. FOMC Rate decisions and Language
3. Focus in macroeconomics
4. Bond Prices have an inverse relationship to Interest rates
5. Correlation to US Dollar prices
6. Inflationary prospects
7. Geopolitical Stability
8. U.S. Fiscal and Monetary Stability
Our brokers here at Cannon will be happy to chat about the Bond market, other interest rate products, other futures, options, futures spreads and much more! Feel free to contact us at any time.
3. Economic Calendar
Source: Moore Research Center, Inc.
| Date | Reports | Expiration & Notice Dates |
|---|---|---|
| 02/28 Fri |
7:30 AM CST - Personal Income & Spending(Jan)
7:30 AM CST - PCE & Core PCE Prices(Jan) 7:30 AM CST - Adv Intl Trade In Goods(Jan) 7:30 AM CST - Adv Retail Inventories(Jan) 7:30 AM CST - Adv Wholesale Inventories(Jan) 9:00 AM CST - Univ of Michigan Consumer Sentiment-Final(Feb) |
FN: Mar Copper(CMX)
Mar Gold & Silver(CMX) Mar Platinum & Palladium(NYM) Mar 2,5,10 Year Notes Options(CBT) Mar Bonds Options(CBT) Mar Wheat Options(CBT) Mar Corn Options(CBT) Mar Oats Options(CBT) Mar Rough Rice Options(CBT) Mar Soybeans,Soymeal,Soyoil Options(CBT) LT: Feb Bitcoin(CME) Feb Black Sea Wheat(CME) Feb Fed Funds(CME) Feb Live Cattle(CME) Mar RBOB & ULSD(NYM) Mar Sugar-11(ICE) Feb Black Sea Wheat Options(CME) Feb Fed Funds Options(CME) Mar Lumber Options(CME) |
| 03/02 Mon |
8:45 AM CST - Chicago PMI(Feb)
9:00 AM CST - Construction Spending(Jan) 1:00 PM CST - Auto & Truck Sales(Feb) 2:00 PM CST - Cotton System(& Ann) 2:00 PM CST - Fats & Oils(& Ann) 2:00 PM CST - Grain Crushings(& Ann) |
FN: Mar Orange Juice(ICE)
Mar Sugar-11(ICE) |
| 03/03 Tue |
9:00 AM CST - ISM Manufacturing Index(Feb)
3:30 PM CST - API Energy Stocks |
FN: Mar RBOB & ULSD(NYM)
LT: Feb Butter(CME) Feb Milk(CME) Feb Butter Options(CME) Feb Milk Options(CME) |
| 03/04 Wed |
6:00 AM CST - MBA Mortgage Index
7:15 AM CST - ADP Employment Change(Feb) 9:30 AM CST - EIA Petroleum Status Report 2:00 PM CST - Dairy Products Sales |
|
| 03/05 Thu |
7:30 AM CST - USDA Weekly Export Sales
7:30 AM CST - Initial Claims-Weekly 7:30 AM CST - Productivity-Rev(Q4) 7:30 AM CST - Unit Labor Costs-Rev(Q4) 9:00 AM CST - Factory Orders(Jan) 9:00 AM CST - ISM Non-Manufacturing Index(Feb) 9:30 AM CST - EIA Natural Gas Report 3:30 PM CST - Money Supply |
|
| 03/06 Fri |
7:30 AM CST - Nonfarm Payrolls(Feb)
7:30 AM CST - Ave Workweek & Hourly Earnings(Feb) 7:30 AM CST - Unemployment Rate(Feb) 7:30 AM CST - Trade Balance(Jan) 2:00 AM CST - Consumer Credit(Jan) |
LT: Mar Canadian Dollar Options(CME)
Mar Currencies Options(CME) Mar Mx Peso Options(CME) Mar US Dollar Index Options(ICE) Mar Live Cattle Options(CME) Apr Cocoa Options(ICE) |
| 03/09 Mon |
|
LT: Mar Cotton(NYM)
|
| 03/10 Tue |
11:00 AM CDT - WASDE Report & Crop Production
3:30 PM CDT - API Energy Stocks |
|
| 03/11 Wed |
6:00 AM CDT - MBA Mortgage Index
7:30 AM CDT - Core CPI & CPI(Feb) 9:30 AM CDT - EIA Petroleum Status Report 2:00 PM CDT - Dairy Products Sales |
LT: Mar Orange Juice(ICE)
|
| 03/12 Thu |
7:30 AM CDT - USDA Weekly Export Sales
7:30 AM CDT - Initial Claims-Weekly 7:30 AM CDT - Core PPI & PPI(Feb) 9:30 AM CDT - EIA Natural Gas Report 3:30 PM CDT - Money Supply |
LT: Mar Nikkei(CME)
Mar Nikkei Options(CME) |
| FN=First Notice, OE=Option Expiration, LT=Last Trade | ||
* Please note that the information contained in this letter is intended for clients, prospective clients, and audiences who have a basic understanding, familiarity, and interest in the futures markets.
** The material contained in this letter is of opinion only and does not guarantee any profits. These are risky markets and only risk capital should be used. Past performances are not necessarily indicative of future results.
*** This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts herein contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgment in trading!
