April 10th, 2015 Newsletter

US Bonds on the Verge of a Double Top? Read Trading 101: Different Markets For Day Trading

April 10th, 2015 - Issue #782

In This Issue

1. Are US Bonds on the Verge of a Double Top?
2. Trading 101: Different Markets For Day Trading
3. Economic Calendar

1. Are US Bonds on the Verge of a Double Top?

By: Ilan Levy-Meyer

click on image below to enlarge

US Bonds on the Verge of a Double Top

When one looks at weekly and monthly charts, it quickly becomes clear that bonds have been in a major uptrend. Going back over the last 14 months or so, most traders who have tried shorting the US treasury bonds (known as the 30 year bonds) got burned.

US bonds have an inverse relationship to interest rates, and as we all know, interest rates are at historic lows, while US bonds are at historic highs. More about the mechanics of this futures contract is available here.

A Potential Double Top on the Horizon

For those of you who read a few my market analytics posted here, you will know by now that I am more of a short term to medium term trader. I look for swing trades lasting from days to maybe weeks, and only rarely over months. This set up is no different. Looking at a daily chart below, I see potential for a double top confirmed with a 5th wave Elliott Wave.

I am looking for a confirmation if prices can break below 163.16 that in return will provide me with initial targets of 162.07 and 159.14, respectively. Tomorrow (Wednesday 8th 2015), FOMC minutes are due. This report may be the catalyst for either another leg up or the start of a short term correction. My speculation for a trade idea is to sell bonds close as possible to 166.00 with a stop above recent highs OR sell bonds on a break below 163.16.

T-Bonds Daily continuation chart ( Heikin-Ashi)

Many ways to trade any market, many ways to lose money in any market and only very few ways to lock in gains - this one is not different. If you need help creating a trading plan, visit our broker assist services.

2. Trading 101: Different Markets For Day Trading

Each market has a different personality, different behavior along with different times of the day when it is most active. If you are finding that the ES (mini SP) is not giving you enough risk/opportunities then start monitoring a couple of other markets and perhaps explore them in demo / simulated mode.

I think that there are more than a few markets that are suitable for day-trading. Below you will find some observations, tips along with what are unique about these markets, personality and most active trading hours (interest rates, mostly the ten year and 30 year).
In most platforms, the symbols are ZB for 30 year bonds and ZN for 10 year notes.

....Read More by filling out the form below.


Trading 101: Different Markets For Day Trading

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3. Economic Calendar

Source: Moore Research Center, Inc.

Date Reports Expiration & Notice Dates
 LT: Apr Eurodollar(CME)
7:30 AM CDT - Core PPI & PPI(Mar)
7:30 AM CDT - Retail Sales(Mar)
7:30 AM CDT - Retail Sales-Ex Auto(Mar)
9:00 AM CDT - Business Inventories(Feb)
6:00 AM CDT - MBA Mortgage Purchase Index
7:30 AM CDT - Empire Manufacturing(Apr)
8:15 AM CDT - Capacity Util & Industrial Prod(Mar)
9:00 AM CDT - NAHB Housing Market Index
9:30 AM CDT - API & DOE Energy Stats
11:00 AM CDT - NOPA Crush
1:00 PM CDT - Fed's Beige Book(Apr)
2:00 PM CDT - Dairy Products Sales  
LT: Apr Lean Hogs(CME)
Apr Lean Hogs Options(CME)
May Platinum Options(NYM)
May Palladium Options(NYM)
May Sugar-11 Options(ICE)
7:30 AM CDT - USDA Weekly Export Sales
7:30 AM CDT - Initial Claims-Weekly
7:30 AM CDT - Building Permits & Housing Starts(Mar)
9:00 AM CDT - Philadelphia Fed(Apr)
9:30 AM CDT - EIA Gas Storage
3:30 PM CDT - Money Supply
LT: May Crude Lt Options(NYM)
7:30 AM CDT - Core CPI & CPI(Mar)
9:00 AM CDT - Leading Indicators(Mar)
9:00 AM CDT - Mich Sentiment(Apr)    
FN: May Cocoa(ICE)
LT: Apr Nikkei Options(CME)
Apr DJIA Options(CME)
Apr S&P 500 Options(CME)
Apr NASDAQ Options(CME)
Apr E-Mini S&P 500 Options(CME)
Apr E-Mini NASDAQ Options(CME)
Apr Russell Options(CME)
May Orange Juice Options(ICE)  

* 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!

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