Good morning, traders,
Lately, long-term Treasury bond yields have been hovering between 4.2% and 4.6%, while the Fed is being cautious with rates, holding them between 4.25% and 4.5%.
You’ve got unemployment at 4.2% … jobless claims trending higher than earlier in the year at 233,000 … and inflation at 2.4%, higher than the Fed’s 2% benchmark.
Add in the political pressure of an election year, and the calls to cut rates are getting louder by the day.
That’s bullish for bonds, plain and simple.
When the market starts pricing in rate cuts, yields drop and bond prices rise. Fast.
And lately, we’ve been seeing exactly that, with massive buying coming in. Some of these rallies have tacked on 2–3 points in a matter of hours.
For a bond move, that’s huge.
But here’s what a lot of traders don’t get…
These moves don’t last forever, and they can reverse just as fast.
One stronger-than-expected jobs number, one sticky CPI print, and boom, bonds give it all back in a heartbeat.
So, when do you pull the trigger, and when do you wait?
This is how I’m handling bonds right now.
Rip ‘n’ Run
I don’t trade this stuff like a long-term investment.
I trade it a lot like a zero-day strategy, where an options contract expires the same day. Where the chances of doubling or tripling my outlay are high and my risk is controlled.
I don’t care about yield curves or macro theory. I play bonds short-term, and I play them for high payoff, risking very little in the process.
That’s the edge.
Think about it…
If you can catch a 1-point move with tightly defined risk using options, that’s a serious reward for a small capital outlay.
You don’t need to be right for a month, you just need to catch the right 24- to 48-hour window.
Upside vs. Downside
Now, these trades are fast. You don’t sit on them.
You hit it, take your 2x or 3x, and get out. The next data point could go the other way and flip the whole picture.
And honestly, that’s why I love this setup so much.
You’re not waiting around for some long-term thesis to play out.
You’re trading off the Fed’s next move and the market’s knee-jerk reaction to it. That’s what creates the opportunity.
High velocity, defined risk, and tight time frames. That’s how I’ve been stacking wins in this environment.
The best part is not needing to put a lot of capital to work.
A few hundred bucks on the right short-term structure can pay off big if bonds rip a point or two in your direction.
And if they don’t? Your downside’s capped. You live to fight another day.
This bond market’s giving us chances most traders will miss entirely.
You’ve got to move fast. But if you do, there’s serious cash on the table.
Speaking of serious cash, my zero-day strategy has been especially helpful since Donald Trump took office back in January, because it allows me to make short-term moves in the wake of his often unpredictable decisions.
Stay street smart,
Jeff Zananiri
P.S. Tonight at 7 p.m. ET, Danny Phee will talk about the fastest-growing opportunities in the market right now:
These contracts move like lightning and hit big. Learn to trade them the right way.
👉 [Save your seat now — before space fills up.]
