T-Bond Futures Trading Idea

10/15/2009 12:01 am EST

Focus:

Michael Riordan

Founder and President, Focus Trading, Inc.

The following chart of December T-bond futures shows a sharp decline from the October 2 payroll highs of 12325.


Click to Enlarge

Reinforcing the bear trend is the fact that prices are now trading below MLR (Moving Linear Regression) at 12202, the 200-day MA at 12100, and AMA (Adaptive Moving Average) at 12025.

Furthermore, prices tested and failed to hold above the weekly pivot at 12030 today after closing below last week’s weekly pivot (12209) for the first time in three weeks. We recognize a bear flag continuation pattern from the October 8 highs of 12307 to the 11920 lows of set last Friday.

A breakout below and close under the T-line at 11931 validates the pattern targeting 11610. Underlying support is seen at the 50-day MA at 11910 and the 100-day MA at 11712. Primary resistance is seen at 12025 (AMA), 12030 (weekly pivot), 12100 (200-day M.A), and MLR at 12202.

By Michael Riordan of FocusTrading.com

Michael Riordan can be found at FocusTrading.com and is a contributor to TraderKingdom.com

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