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ZN_Requesting feedback_Chart type and learning books/resources for ZB
sincerely appreciate if any of ZN trader can provide some kind of feedback for below two questions. sincerely appreciate any feedback .
Background: trading indexes CL GC in sim on 5 min chart with Al brooks PA. still practicing and learning but 5 min chart works for me.
Issue: for ZN 5 min chart is a bit jagged and slow to respond. i am not able to get any edge honestly both because chart is slow and i don't know do's and dont's of treasuries. i want to learn at least fundamentals regarding what makes ZN go up and down. all i see is strong correlation with GC
Q1: any feedback on type of chart that other traders are using? specifications of chart higher level settings? like tick charts tick and how many ticks etc?
Q2: any resources/books/blogs to specifically learn about treasuries futures trading specifically? any chatroom that i can join for a month or two just to learn treasuries futures trading (or at least get some ideas/pointers)
US fixed income can be comatose at times in its movements. If you are studying price action via Al Brooks method maybe consider using volume bars and expanding your time horizons.
John Grady (NoBSDayTrader), Tom Baldwin and Charles DiFrancesco are all/were successful US treasury traders to at least look into a bit.
Also, maybe consider looking at German Bund as it movements tend to be closer to ES and more forgiving than ZN, ZF and ZB.
Well, if you compare CL to ZN, yes, the 5 min chart of ZN is slow to respond.
Any chart of ZN is slow to respond, actually.
The difference between these instruments is enormous: CL is extremely fast-moving and will take your head off, ZN will put you to sleep. They are close to the two ends of the spectrum.
I hope someone else can answer your questions and that you find out what you need about ZN. But I think that unless there is a particular reason you want to trade ZN, there are any number of other instruments that are more active.
Bob.
When one door closes, another opens.
-- Cervantes, Don Quixote
Legendary / Stochastic Calculus is not your friend
Experience: None
Platform: Ninjatrader, Python API
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Trading: S&P, Crude, Gold
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@SFT80 when I trade ZN or any of the bonds I prefer to use tick charts....you may want to have a look at 300 tick and lower, maybe 233 tick to see if the price action speaks to you. Also, order flow price ladder charts work well too...but that is a steep learning curve and another story.
Trading bonds can be lucrative considering the high volume and professional traders, no slippage and low cost. But yes...sometimes like watching paint dry, other times it trends well.
When you trade fixed income, you begin to step out of the world of charts, indicators, and the like, and into the world of yield curves and auctions. Sure, fixed income certainly plays by some rules of support/resistance, but it becomes a much more macro type of trading.
If you don't understand the following, consider NOT trading fixed income until you do: a "stop through" in a bond auction; quickly identifying that a flat ZF, moderately bid ZN, and a very bid ZB is a bull flattener; what's the zn:zb ratio for a NOB spread?
That's not meant to throw out stuff to scare you. These are things that even noob fixed income traders know, and this is basically treasuries 101. I am *not* a fixed income trader, and I've known this stuff for years; yet, I am not nearly sophisticated enough to even think about trading the fixed income space. It's a different world, and you'd better know really well the world you're stepping into.
It's not "Al Brooks 5 minute charts" land, though certainly a strategy like that may work well; it's a macro world which is ultimately much *bigger* than equities, with *much* bigger players. You're 100% in "retail trader" mode, focusing on chart settings, and the like. You will be absolutely eaten alive, at this point. Proceed with caution, and educate yourself on how fixed income works before you even think about trading it.
Edit: this is not meant to belittle your current level of understanding. On the contrary, it's to encourage you to get ahead of the game before you jump into it thinking that the knowledge of trading crude is transferable to trading fixed income.
And it's not to say that you can't trade ZN tomorrow and do very well. But long term, you need to understand more about how it works. Imagine not understanding how crude could trade negative prices like it did last year, and getting wiped out by loading up when it was $10/bbl for example, thinking it couldn't go below zero. Understanding the dynamics of the market you're trading are crucial to *long term* success.
As others have stated, when you begin to trade treasuries you start ditching charts and other methods of trading popular on other instruments in favor of a more orderflow (mainly short term trading) or macro (more mid-long term) oriented type of trading.
I personally suggest checking out John Grady's website and youtube channel his content is gold.
Please for the love of god put your credit card back in your wallet and go search for posts from 's0mmi'. He's on here and elitetrader and spells out some legitimate trade ideas for spreading treasuries. It's also worth getting on twitter, there's a small handful of legit fixed income traders on there that will shed light on how they attack it (you will likely have to wade through their various conspiracy theories and other sh*tposting).
