A Simple Swing Trade Setup for Euro-BTP Futures

21 апр. 2022 г.

Since earlier this year, all European bonds have extended losses due to the impact of Ukraine war. The downtrend is persistent; therefore, the only trading action we will take is to short the market. Among all European bonds, the Italian government bond (Euro-BTP Futures) drops somewhat in an orderly fashion (breakouts with clear pullbacks). Therefore, we will be looking to enter sell positions in this market in the near future.

Euro-BTP futures has recently made a new low at the support area of 132.50, which indicates that the downtrend is still very valid. The price is currently in the bearish impulse stage, therefore, there is no immediate trading action for us to take. Our plan is to wait for the price to retrace back to the 138.00 area (previous support level), and from there we will watch the price action and enter sell positions.

Euro-BTP futures is currently among the top products to watch in our passive trading portfolio because the movement is not as sharp as other European bonds, such as the Euro-BUND futures (German gov’t bond) and Euro-OAT futures (French gov’t bond), where they fall without much of a retracement.

We will update this post as the price comes near our entry zone.