1 Trade to Make Now Thanks to Sticky Inflation

December U.S. T-Bond (ZBZ26) futures present a selling opportunity on more price weakness.

See on the daily bar chart for December U.S. Treasury bond futures that prices are trending down and have just hit a contract low. See, too, at the bottom of the chart that the moving average convergence divergence (MACD) indicator is in a bearish posture as the blue MACD line is below the red trigger line and both lines are trending down. The bears have the solid near-term technical advantage.

 Fundamentally, global inflation remains sticky and is on the verge of becoming problematic for economies. That means central banks, including the Federal Reserve, will very likely have to tighten their monetary policies. Meanwhile, the U.S. economy is proving resilient, also suggesting the Fed won’t be able to ease monetary policy anytime soon. Those are bearish elements for bond prices.

A move in December T-Bond futures below chart support at 101 even would become a selling opportunity. The downside price objective would be 94 even, or below. Technical resistance, for which to place a protective buy stop just above, is located at 104 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.