Have you heard about the Bond line trading strategy?
It is a simple trading strategy that measures the daily ranges.
Fun fact: It was developed in 2021 by one of the traders, named Bond.
For those who were thinking the strategy was related to James Bond. Unfortunately, it’s not. It’s about finding the highest and lowest points during the Asian and European sessions. But let’s not get ahead of ourselves.
In this guide, we’ll talk about Mr. Bond’s lines and how you can trade them.
What are the Bond lines?
First, let’s talk about what Bond lines are.
You already know that Bond lines were developed in the trading room of a trader named Bond. But did you know it all started in the OneUp Trader room?
He measured the daily ranges based on geometry and the trading zones.
How does it work?
You know, the market moves up and down, sometimes sideways. As a trader, our job is to predict price movement. Here’s where the Bond lines come into play.
The strategy revolves around two zones and a price target. These zones are Zone 1 and Zone 2.
You can think of them as support and resistance zones. The price move between these zones presents us with entry and exit points.
So, we can trade accordingly.
But here, the quick question is, “how can you create these zones?”
You don’t need any specific ruler to do that. We need to follow some criteria.
We need to mark the high and the low of the Asian and European sessions. We need to mark these levels before the US session, as this is when we’ll take our positions.
The second thing you must remember is the start of the Asian and European sessions. The highs and lows of these trading sessions are what we need to find, and then we enter the trade after the US session begins.
The chart below highlights the two vertical lines, each representing the start of the session.
The following chart shows the highs and lows of each session.
To create bond lines, you must draw a horizontal line from low to high. As you can see here, we have connected the low and high points, giving us our zone.
The key point is that we are using Tradingview to draw these zones. You can use other charting services too.
We need to calculate 50% of these two horizontal lines for our trading strategy. After creating the first zone, we need to create one zone below and one above our first zone.
Here we’ll apply a simple copy-paste and have our zones.
On the chart above, you can see that prices are moving from zone 1 to zone 2. It presents us with a target on where we can take our positions.
Here you can see that the price is moving directly into the bottom of zone 2. It presents us with a good selling opportunity.
It’s better to wait for the price action to follow the trend and then take positions. On the chart above, there was an array of bearish candles after hitting the highest point. So, in these situations, the price action should continue its path and then take positions.
How to trade with the Bond lines?
Now there is no guesswork here. You must find the high and low swing between the Asian and European sessions. Then you need to take positions in the US session.
The Bond lines will present you with several entry points, and you can take positions accordingly.
Again we should remind you that after creating zone 1, you must copy and paste the zone above and below. It will give you an overall idea of the trend.
For example, if the price goes above zone 1 and enters the upper zone, there is an uptrend, and you need to find trading opportunities accordingly.
The best way to enter the trade is at the lower line of zone 1. Here we have the ideal situation. You can set the second target at around 50% of the lower zone.
5-minute Bond lines trading strategy
Now that you know about the Bond lines and how you can create them, we will discuss the 5-minute strategy. The concept remains the same; here, we change the timeframe.
Here we have the 5-minute crude oil chart. Here we have created the Bond lines and connected the high and low points.
You can see that it has presented us with several profit targets. The market is trending, and we can use the Bond lines to ride with the trend on such days.
It makes Bond lines super effective in range trading sessions also.
You can also trade with the Bond lines and other trading strategies.
For instance, if you have a strategy, you can use the Bond lines to make the strategy work out. Again, it doesn’t matter if it is a range-bound day or a trend day; the Bond lines will work.
Important factors to consider when trading Bond lines
You need to consider some important factors while trading on the Bond lines.
Here are some of the things you need to know:
Trading without risk management is similar to skydiving without a backup parachute.
Risk management is part and parcel of your whole trading strategy. Protecting your profits is the only way to produce consistent profits and ensure a long and successful trading career.
Stop losses are one of the simplest and most effective strategies to protect yourself from the risks of volatile market moves.
Overtrading is one of the most dangerous foes a trader can encounter.
And seasoned traders will have already figured this out – otherwise, they wouldn’t be in business.
Overtrading has several definitions, ranging from trading too frequently in a short period to trading much above your risk limit.
So how can you avoid overtrading?
Of course, this is easier said than done.
Here’s a quick tip to avoid overtrading: Only take a few trades, like two or three in a single day.
If you win, close the platform, and don’t get greedy. If you lose, close the platform and try the next day again.
“Throw your emotions out of the window.”
It may sound like a harsh sentence, but you have to follow it. Otherwise, trading won’t be your cup of tea.
You must let go of emotions like fear, greed, and overconfidence to succeed in trading.
They restrict your trading in a way, and you end up losing. So, make sure to throw emotions out of the window.
Trading with no plan
Trading without a plan is like having a car without tires.
A trading plan is essentially a blueprint for your trading day/week. Over the weekend, a trader researches the markets in which they are interested in trading and develops probable trade ideas.
You can use the trading plan to record potential entry points, set strategies, and make risk-management rules.
How to trade Bond lines with OneUp Trader?
Bond lines are just a single piece of the pie in trading strategies available on OneUp Trader. You can try and hone in on your trading skills without a hiccup.
The cool thing is that you can trade without any restrictions. If you think you have the right skills and knack for trading, you can get a fully-funded trading account within 15 days. How cool is that?
You can find everything on the FAQ page if you have any queries. If you still have a question, you can contact the support team, which is available 24/7.
Don’t risk your capital, trade with OneUp Trader!!
Mr. Bond lines trading video example
So there you have it. What started as a trading room in 2021 is now a good trading strategy. The good thing about the Bond lines is that they work in both range and trend trading.
The strategy is simple to follow, and you need to note the start of the Asian and European sessions. Then, you must find the swing high and low between these sessions and create horizontal lines on the chart, and voila!
If you want to tap into Bond’s lines strategy, go through the guide or check out our video.