See on the daily bar chart for September U.S. Treasury Bond (ZBU26) futures that prices have made a solid rebound from this week’s low, to raise the potential for a bullish double-bottom reversal pattern that would suggest a near-term market bottom is in place and that prices can trend higher.
Fundamentally, hopes for an end to the U.S.-Iran war are on the rise, which has crude oil (CLM26) prices sharply down, which has in turn lowered the prospects for problematic global inflation —which would allow major central banks to lean easier on their monetary policies. Also, the prospects for lower U.S. interest rates will be better when the new Federal Reserve Chair, Kevin Warsh, comes to office in the coming weeks.
A move in September T-Bonds above chart resistance at 113 10/32 would become a buying opportunity. The upside price objective would be 116 16/32, or above. Technical support, for which to place a protective sell stop just below, is located at 112 even.
IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any trades and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.
Here is what the Commodity Futures Trading Commission (CFTC) has said about futures trading (and I agree 100%):
Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.
On the date of publication, Jim Wyckoff did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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