Switching from ES to Bonds

Discussion in 'Financial Futures' started by 9Baller, Jun 30, 2009.

  1. 9Baller


    I have been trading ES for several years...had a trend this AM...but seems like this market is always in the chop...and I'm getting frustrated...

    I've never traded bonds and I wanted an opinion if any of you have switched from the ES to bonds or another market and found the transition smooth..

    From what I see in the bonds If put a scalp on...I am going to get my answer relatively soon...right or wrong the verdict comes in quickly...better volatility and trendability...

    with the ES...that answer is not swift...not since March atleast...market churns a few ticks...and the whipsaws have been a problem lately...any thoughts?
  2. Be careful what you wish for. The bonds/notes have been "whippier" but volatility should return to stocks after Labor Day. :cool:
  3. I switched from ES to the 10 yr Note and Euro FX futures last year. To date, I believe the Euro FX futures is the best market to trade: both swing and intraday. While both market trend well, but they will back and fill. You may need to use a larger time frame if day trading. I went from 3-5 minutes for the ES to 10-15 minutes for the 10 year and Euro. Looked at the 30 yr bond but found the 10 year to be less volatile and the smaller tick size appealing.
  4. 9Baller


    yes more places to exit is appealing...what do you guys think of the CME's move to double the tick size back to 1/32...action in the ES was awful again today...
  5. I traded bond futures for about 15 years, and then last September I went on vacation; and when I came back, I started trading the ES. I'm not quite sure why. It just seemed like the thing to do.

    Personally, I find the ES easier to trade than ZB. I think it's because the bonds are more sensitive to data releases. If you start trading ZB, I would advise you to study carefully the way the market handles the numbers releases.

    Bonds also go through periods when the action is hard to trade profitably (especially in August). They don't have any advantage over ES in that respect.

    The change from 1/32 to 1/16 was a big mistake. Traders tried to tell the exchange before it happened, but the exchange knew better. If they go back to 1/32, I may go back to trading bonds.

    Or maybe not. I really like the ES now.
  6. Minimum Tick Size Increase for 30-Year T-Bond Futures

    On Sunday, August 30, 2009 (trade date Monday, August 31, 200) the minimum tick size for 30-Year U.S. Treasury Bond futures will increase from ½ of 1/32nd to 1/32nd of a point ($31.25). This change will be applied to all expiration months. The minimum trading increments for futures intermonth and intercommodity spreads as well as options will be unchanged.

    If you have any questions, please contact:

    Liz Flores (312.338.2801)
    Jeff Kilinski (312.648.3817)
    Jonathan Kronstein (312.930.3472)
    Suzanne Spain (312.338.2651)
  7. I have traded both markets for about 7 years now and the spooz are volatile for a while then the algo's come back like how it is now-horrible I think last week I sat in a trade for 2 hours to make 2 handles. It usually has one move then a 3 handle chop for hours the long end of the curve is moving a lot but you can not hold onto losers they trade so many cars through and it moves and does not come back sometimes which can be quite painful. We talk about ZN and ZB a lot in the anyone short the 30 yr bond thread it helps to be able to look at the curve and cash mkts when trading the long end. Not necessary but an edge for sure.
  8. moarla


    the ES is slow now for 2 or 3 weeks. you will note that when a bigger trend is changing, like in 2008, the market gets choppy...

    so lets se what happens...

    EUR is 95% trending and moving well, dont understand why not more traders are trading it....
  9. NoteBoy


    I'm in the same boat, primarily traded notes since 2004, but made the switch to primarily trading ES in late September last year. The volatility in the notes just became too wild and random compared to what I was used to, I had too much baggage to adjust that much that quickly so decided to move to a product where I didn't have as many preconceptions about what was "normal" movement (keep in mind I learned to make money in the notes when it was bid 5000+ contracts at every price and had days where there'd be only a 6 tick range). That and the fact I had done very well trading the ES as a secondary product last year, so it was about time I made it my main vehicle (wish I did it sooner). ES has been good to me, but now that I've been away from the notes for a while I'm thinking of getting back in with a clean slate and open mind as to it's new way of moving.

    As for the OP, keep your eyes on what the curve is doing, and where the cash yields are (sometimes there are key levels there). After making the notes-ES switch myself (albeit the other way), I would recommend trying it. An experienced trader coming in to a product with a fresh perspective without mental baggage can be quite profitable. Even if it doesn't work out, then in a couple months you can switch back to ES and bring a fresh outlook to that.

    Of course, the healthier way to take a step back and get a fresh outlook on your product is to take a vacation, but who has time for that in these times? :D
  10. 9Baller


    thanks for the input...I have to admit that I like the movement in the bonds right now...the volatility will change I suppose when the larger tick size comes in effect...when the ES volume dips below 2000 contracts per minute....(most of the day lately) action is sloppy and deceptive...
    #10     Jul 6, 2009