Futures: US 30YR T-BOND H'10 - CORRECTIVE
Technically the MKT is in a NEUTRAL CORRECTIVE state producing a negative signal against a positive trend. Opportunity exists on both sides of the MKT, however the underlying positive momentum will remain in command above the 116-22 Inflection Pivot.
On the SELL side avoid FADE strategies against 118-11 until after the previous session low point or major support level has been broken to confirm a negative shift in momentum. Until then a better opportunity will be a REVERSAL strategy but only off 118-11. This is a one shot trade using a low risk big profit target criteria. The idea is that if the MKT is going to follow through on its negative signal any strength is just a "head fake " before it follows through. SELL BREAKOUT strategies below 116-22 can be profitable but they are aggressive and should look to take profits and potentially REVERSE long at support targets. The trade is corrective and the underlying positive tone must be respected.
On the BUY side accept BREAKOUT, FADE and REVERSAL strategies off major inflection points with the expectation that the positive momentum is going to resume. REVERSAL strategies are recommended over a FADE strategies off 116-22, which should have at least 1 if not 2 challenges to the support integrity before executing a long off it. BREAKOUT strategies above 118-11 can risk a little more if current events and other MKTs of confluence confirm a positive posture with the expectation that the Bull Trend is going to resume. If not a better approach would be to FADE a negative "squeeze" reaction at the 117-16 Directional after a positive breakout signal as the neutral technical position can keep the trend sideways.
Note: The MKT is in a corrective position with the potential to move in either direction. Keep your opinions to themselves and focus on what the MKT is telling you it wants to do. Don't fight it, roll with it.
JS
This post supports the Strategy Based Trading, which is a methodology that focuses on the applied strategy verses a specific market. The approach looks to align strategies with markets whose current technical behavior matches the strategies criteria. Please review the following CME sponsored tutorial for a complete overview of this approach.
STRATEGY BASED TRADING Review http://progressive.powerstream.net/008/00102/edu/interactive/js_services/strategy_based_trading/index.html
For more information please contact me at info@jsservices.com. You can also visit http://www.jsservices.com/.The Inflection Pivot levels are available as a chart overlay on the following platforms; Ninja trader, Strategy Runner and eSignal. Sign up for a Complimentary FREE Trial.
