[Soultrader]

Here's a trade I did today in the 30 year bonds with a horrible execution.

2 losing trades.



The first arrow shows my short entry. Price rallies at the open and is rejected 1 tick away from VAL. The reason for my short was because bonds opened below value.

Entry: The price rejection at 111 18/32 was pretty quick and I watched prices auction a for the one 5 minute bar. My tape reading skills in the bonds is still unexperienced compared to the YM and I hesitated and went short with a market order which got me filled at 111 13/32. The moment I was filled, I knew I had made a horrible entry. Normally, I would use a 3 tick stop. But because of my horrible entry I decided to use a 6 tick stop right above the HOD. About half hour later I was stopped out by 1 tick. Approx. 200 contracts trade on a 3000 thick contract ask. I was one of the 200 lots.

I then reshorted at the blue arrow labeled #1. I felt better about the entry but had my eyes glued on tape. About a half hour later, I felt prices holding firmly at 111 15/32. I decided to cover for a scratch trade. Shortly after, bonds declined for approx 4 ticks past my entry.

A couple of things come to mind. My hesitation on the first trade. My loss on my first trade affected my second trade.

I would like to receive some feedbacks. Any criticism is welcome. Thanks

[notouch]

On the daily chart it looks like the start of an up trend so weren't you breaching your own trading rules by taking a short? The first hourly candle was bullish too and on high volume so it looks like you paid the price for ignoring your own rules.

I personally concentrate on the fundamentals for trading bonds and treasuries, especially on days like today with the weak trade number and expected weak retail sales number tomorrow being bullish for bonds. I didn't trade ZN today but probably will after tomorrow's retail sales number.

[Soultrader]

The daily chart looked mixed to me. So I went down to the 65 minute. The chart below shows a 2 day downtrend in the bonds. Hence the reason for a short.



Yes, I definitely need to be more aware of the fundamentals with the bonds and how they react to numbers. In hindsight the volume spikes of the past sessions shows good support compared to todays volume at the lows.

[nasdaq5048]

Maybe tape reading in the bonds isnt as useful as the dow. There are a lot of curve trades and locals scratching contracts that they got from the pit in the bonds. So, hitting the bid might just be the other leg of a yield curve trade.

U might want to listen to the bonds squawk and get a feel for what goldman is doing in the pit.

[notouch]

What you say about the yield curve is exactly what I was thinking. Unlike the Dow there's no speculative retail participation in the bonds. There's yield curve traders, arbitrageurs, hedgers and long term investors to name a few so how could you make sense of all that from the tape? You have my admiration if you can.

I don't agree with what you say about the bond squawk because most of the volume is electronic.

[nasdaq5048]

Originally Posted by notouch »

What you say about the yield curve is exactly what I was thinking. Unlike the Dow there's no speculative retail participation in the bonds. There's yield curve traders, arbitrageurs, hedgers and long term investors to name a few so how could you make sense of all that from the tape? You have my admiration if you can.

I don't agree with what you say about the bond squawk because most of the volume is electronic.

Bonds squawk are mostly on options and yield curve. Not much outright quotes.
At least u know PIMCO and goldman are huge sellers of puts or buyers of calls, then u can develop a bias. Better than watching the screen's time & sales trying to figure out what the uptick and dntick means.

[notouch]

I've never used a bond squawk. I've only ever used the tradersaudio S&P Squawk which I found worse than useless. Do you have any recommendations for a bond squawk and how to use it? I'm not concerned with catching every tick, just the bigger moves.

[torero]

James, have you started trading grains yet? I'm watching bonds, but makes me want to zzzzzz...