The Greatest of All-Time (After Retirement?)
Welcome to Issue 049 of Masters in Trading Digest.
In Monday’s Digest, we sent you a warning of heightened market uncertainty.
Did you take action?
We include a video in today’s Digest to review our hedge for the week.
Michael Jordan made buckets of money during his career, but the real earnings power happened at retirement.
The belly of the yield curve is trading too steep – a trade shared to wack this move back inline.
And, as always – new trades are released Sunday evening for our members.
Enjoy,
Jonathan
BROKEN BONDS
Using our proprietary Futures EDGE web-based charting system, I charted 3 different Bond Spreads below.
- FIT: spread between the 5yr and 10yr
- NOB: spread between the 10yr and 30yr
- FOB: spread between the 5yr and 30yr
IMPORTANT
FIT + NOB = FOB
The FOB includes the FIT + the NOB, so the FOB can not trade without its components eventually following.
Now, let’s look at this same chart, but instead of only looking at the last 30 days, now we can look at the last 360 days.
In my opinion, the FIT, or relationship between 5s and 10s is trading too “steep” relative to the rest of the yield curve.
To capitalize on this trade, traders may consider selling FITs and buying the NOB.
This is my favorite futures trades and with the Fed moving interest rates, the time for this trade is NOW.
Masters in Trading Digest - Issue 49
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INTERESTING TIDBITS DISCUSSED THIS WEEK
How Michael Jordan Turned $94 Million into $2.5 Billion – sure, MJ is widely considered the greatest basketball player of all time but when it comes to investments his skills come close to matching up. When Michael Jordan retired from basketball he was considered the wealthiest athlete in sports history, yet less than 4% of total net worth came from his NBA salary.
Citi Projects Metaverse to Capture Five Billion Users and Up to $13 Trillion – It’s incredible the onslaught of institutional activity we are seeing in Web 3.0. Citi has high expectations for the metaverse with bank analysts projecting the Web3 infrastructure to reach between $8 trillion and $13 trillion by 2030. Seems like a conservative bet to me!
Treasury Secretary Janet Yellen Calls Crypto “Transformative” in Wide-Ranging Speech – The U.S official addressed CBDCs, stablecoins and regulations. Right from the start, this story will have you smiling. A digital dollar could become “trusted money comparable to physical cash.”
HEARD IN OUR DISCORD
This week was saved with a short term hedge in the $QQQ.
$100 of Risk on Monday turns into $906 by Thursday.
NEW Video Walks You Through $QQQ Short Term Hedge
FINAL THOUGHTS
WHAT TO EXPECT IN THE NEXT MIT DIGEST
Did you get a chance to watch our MIT Web 3.0 Presentation – Searching For Magic Internet Money?
Here’s the shortlist for Sunday trade ideas. This week, I will go through each name and share where we see the BEST trading opportunities.
Keep your feedback coming into support@mastersintrading.com. We’re excited to share your feedback along with fantastic suggestions for upcoming issues.
Until then, trade smart and always manage your tail-risk.
Thanks for reading,
Jonathan Rose
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