12/11/2013 10-yr Bond Auction (1301 EST)
Previous: 2.75/2.7
Actual: 2.82/2.6
SPIKE WITH 2ND PEAK
Started @ 130’00 (1301)
1st Peak @ 129’24 – 1305 (4 min)
8 ticks

Reversal to 129’30 – 1311 (10 min)
6 ticks

2nd Peak @ 129’15 – 1411 (70 min)
17 ticks

Reversal to 129’20 – 1433 (92 min)
5 ticks

Notes: Report is scheduled on Forex Factory at the top of the hour, but the spike always breaks 1 min late. The highest yield rose moderately since last month. This caused the ZB to fall for 8 ticks in 4 bars as it contended with the 200 SMA, then reached the S1 Mid Pivot. With JOBB, you would have filled short at 129’30 with no slippage, then seen it fall to struggle briefly with the 200 SMA, then break free for a few more. I would move the stop to 129’29 and place the target at 129’26. This would have given you 4 ticks with ease as the S1 Mid Pivot held. After the 1st peak, it reversed for 6 ticks in the next 6 min back to the 50 SMA. Then it fell for a slow developing 2nd peak of 9 more ticks in the next hour, crossing the S1 Pivot. After that it reversed for 5 ticks in about 20 min, back to the 50 SMA.

10/9/2013 10-yr Bond Auction (1301 EDT)
Previous: 2.95/2.9
Actual: 2.66/2.6
SPIKE/REVERSE
Started @ 132’30 (1301)
1st Peak @ 133’03 – 1302 (1 min)
5 ticks

Reversal to 132’27 – 1331 (30 min)
8 ticks

Notes: Report is scheduled on Forex Factory at the top of the hour, but the spike always breaks 1 min late. The highest yield fell back to the level of August after spiking to 2.95 in September. Due to the FED decision to delay tapering QE3 and mortgage rates falling after rising substantially since May, this is not surprising. This caused the ZB to rally for a meager 5 ticks in 1 bar, unwilling to venture outside of the major SMAs, with the 100 and 200 SMAs keeping it in check. With JOBB, you would have filled long at 130’00 with no slippage, then had an opportunity to capture up to 2 ticks before it backed off. With the S1 Mid Pivot looming a little above, I would have placed a target at 130’04, then when it did not fill, look to capture 1-2 ticks. After the initial peak, it backed off, then achieved a double top before reversing for 8 tick as it extended the LOD 2 ticks lower.

8/7/2013 10-yr Bond Auction (1301 EDT)
Previous: 2.67/2.6
Actual: 2.62/2.5
DULL REACTION
Started @ 133’23 (1301)
1st Peak @ 133’25 – 1302 (1 min)
2 ticks

Reversal to 133’21 – 1302 (1 min)
4 ticks

Notes: Report is scheduled on Forex Factory at the top of the hour, but the spike always breaks 1 min late. The highest yield fell marginally from the previous auction after significant gains in the last 2 auctions. This caused the ZB to yield a dull reaction of only 2 ticks on either side of the origin. Unfortunately this would have nicked our long entry with JOBB at 133’25, then the stop would have filled for a 3 tick loss. We continue to recommend a 2 tick bracket as the typical yield for this report is 10 ticks or less, so the extra tick is worth the risk. Also, a dull reaction will normally allow an exit at breakeven as the previous occurrences have.

6/12/2013 10-yr Bond Auction (1301 EDT)
Previous: 1.81/2.7
Actual: 2.21/2.5
SPIKE WITH 2ND PEAK
Started @ 139’10 (1301)
1st Peak @ 139’05 – 1302 (1 min)
5 ticks

Reversal to 139’16 – 1303 (2 min)
11 ticks

2nd Peak @ 138’30 – 1319 (18 min)
12 ticks

Reversal to 139’11 – 1341 (40 min)
13 ticks

Notes: Report is scheduled on Forex Factory at the top of the hour, but the spike always breaks 1+ min late. The highest yield rose significantly from the previous auction. This caused the ZB to spike short for a muted 5 ticks as it was stuck on the 200 SMA, then retreat fairly quickly. With JOBB you would fill short at 139’07 with no slippage. I decided to leave the stop loss unchanged at 139’12 with the 200 SMA sitting at 139’10 and acting as resistance, then I was stopped about 30 sec after I was filled as it reversed up to the 100 SMA and R1 Mid Pivot for 11 ticks. Then it left that wick naked and fell again to chop lower for an eventual 2nd peak of 12 ticks after about 18 min, crossing the PP Pivot briefly. Then it popped back up for a final reversal of 11 ticks in about 22 min to reach the intersection of the 100 and 200 SMAs.